Agent, Broker & Adjuster Licensing and Market Conduct¶

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Idaho Code Title 41 (Insurance)¶

Chapter 1¶

I.C. § 41-101: Short title¶

This act constitutes the Idaho insurance code.

Legislative History: [41-101, added 1961, ch. 330, sec. 1, p. 645.]

I.C. § 41-102: "Insurance" defined¶

"Insurance" is a contract whereby one undertakes to indemnify another or pay or allow a specified or ascertainable amount or benefit upon determinable risk contingencies.

Legislative History: [41-102, added 1961, ch. 330, sec. 2, p. 645.]

I.C. § 41-103: "Insurer" defined¶

"Insurer" includes every person engaged as indemnitor, surety, or contractor in the business of entering into contracts of insurance or of annuity.

Legislative History: [41-103, added 1961, ch. 330, sec. 3, p. 645.]

I.C. § 41-104: "Person" defined¶

"Person" includes any individual, insurer, company, association, organization, Lloyd’s insurer, society, reciprocal insurer or interinsurance exchange, partnership, syndicate, business trust, corporation and every legal entity.

Legislative History: [41-104, added 1961, ch. 330, sec. 4, p. 645.]

I.C. § 41-105: "Director," "department" defined¶

(1) "Director" means the director of the department of insurance of this state.

(2) "Department" means the department of insurance of this state.

Legislative History: [41-105, added 1961, ch. 330, sec. 5, p. 645.]

I.C. § 41-106: "Domestic," "foreign," "alien" insurer defined¶

(1) A "domestic" insurer is one formed under the laws of this state or an insurer which has transferred its domicile pursuant to section 41-342 , Idaho Code, to this state.

(2) A "foreign" insurer is one formed under the laws of a jurisdiction other than this state.

(3) An "alien" insurer is one formed under the laws of any country other than the United States of America, its states, districts, territories, and commonwealths.

(4) Except where distinguished by context, "foreign" insurers includes also "alien" insurers.

Legislative History: [41-106, added 1961, ch. 330, sec. 6, p. 645; am. 1987, ch. 302, sec. 4, p. 643.]

I.C. § 41-107: "State" defined¶

When used in context signifying a jurisdiction other than the state of Idaho, "state" means any state, district, territory, commonwealth, or possession of the United States of America, and the Panama Canal Zone.

Legislative History: [41-107, added 1961, ch. 330, sec. 7, p. 645.]

I.C. § 41-108: "Domicile" defined¶

The "domicile" of an insurer means:

(1) As to Canadian insurers, Canada and the province in which the insurer’s head office is located.

(2) As to other alien insurers authorized to transact insurance in one or more states, as provided in section 41-340 (retaliatory provision).

(3) As to alien insurers not authorized to transact insurance in one or more states, the country under the laws of which the insurer was formed.

(4) As to all other insurers, the state under the laws of which the insurer was formed or the state to which the insurer has transferred its domicile.

Legislative History: [41-108, added 1961, ch. 330, sec. 8, p. 645; am. 1987, ch. 302, sec. 5, p. 643.]

I.C. § 41-109: "Principal office" defined¶

"Principal office" means:

(1) As to Canadian insurers, the office in Canada from which the general affairs of the insurer are directed or managed;

(2) As to other alien insurers authorized to transact insurance in one or more states, the office in United States from which the general affairs of the insurer in the United States are directed or managed;

(3) As to all other insurers, the office from which the general affairs of the insurer are directed or managed.

Legislative History: [41-109, added 1961, ch. 330, sec. 9, p. 645.]

I.C. § 41-110: "Authorized," "unauthorized" insurer defined¶

(1) An "authorized" insurer is one duly authorized by a subsisting certificate of authority issued by the director to transact insurance in this state.

(2) An "unauthorized" insurer is one not so authorized.

Legislative History: [41-110, added 1961, ch. 330, sec. 10, p. 645.]

I.C. § 41-111: "Certificate of authority," "license" defined¶

(1) A "certificate of authority" is one issued by the director evidencing the authority of an insurer to transact insurance in this state.

(2) A "license" is authority granted by the director pursuant to this code authorizing the licensee to engage in a business or operation of insurance in this state other than as an insurer, and the certificate by which such authority is evidenced.

Legislative History: [41-111, added 1961, ch. 330, sec. 11, p. 645.]

I.C. § 41-112: "Transacting insurance" defined¶

"Transacting insurance" includes any of the following:

(1) Solicitation and inducement.

(2) Preliminary negotiations.

(3) Effectuation of a contract of insurance.

(4) Transaction of matters subsequent to effectuation of a contract of insurance and arising out of it.

(5) Mailing or otherwise delivering any written solicitation to any person in this state by an insurer or any person acting on behalf of the insurer for fee or compensation.

Legislative History: [41-112, added 1961, ch. 330, sec. 12, p. 645; am. 1971, ch. 328, sec. 1, p. 1293.]

I.C. § 41-113: Compliance required — Public interest¶

(1) No person shall transact a business of insurance in Idaho, or relative to a subject of insurance resident, located or to be performed in Idaho, without complying with the applicable provisions of this code.

(2) The business of insurance is one affected by the public interest, requiring that all persons be actuated by good faith, abstain from deception, and practice honesty and equity in all insurance matters. Upon the insurer, the insured, and their representatives, and all concerned in insurance transactions, rests the duty of preserving the integrity of insurance.

Legislative History: [41-113, added 1961, ch. 330, sec. 13, p. 645.]

I.C. § 41-114: Legal service expense plans¶

41-114B. Legal service expense plans. (1) The term "legal service expense plan," as used in this section, means a contract or agreement for a stated consideration between a plan administrator and a member or group of members, whereby the member pays the administrator, in advance or by installments, for the receipt of professional legal services, advice or representation. Such services in Idaho shall be provided by attorneys at law licensed in Idaho. The attorneys shall be prepaid under a contract or agreement with the administrator to provide specified legal services for the express benefit of the plan member and shall agree to render services to the member when required.

(2) The marketing, sale, contracting, issuance of a contract, plan administration and delivery of services under a legal service expense plan are exempt from all other provisions of title 41 , Idaho Code. In addition, such plans shall not be characterized as "insurance" when marketed in Idaho.

(3) Legal service expense plans, but not law firm retainer agreements, shall be subject to the provisions of the Idaho consumer protection act, chapter 6, title 48 , Idaho Code, and attorneys providing service shall be subject to the provisions relating to the regulation of the practice of law under title 3 , Idaho Code.

Legislative History: [41-114B, added 2001, ch. 127, sec. 1, p. 449.]

I.C. § 41-115: Particular provisions prevail¶

Provisions of this code relative to a particular kind of insurance or a particular type of insurer or to a particular matter shall prevail over provisions relating to insurance in general or insurers in general or to such matter in general.

Legislative History: [41-115, added 1961, ch. 330, sec. 15, p. 645.]

I.C. § 41-116: Captions not to affect meaning¶

The scope and meaning of any provision of this code shall not be limited or otherwise affected by the caption or heading of any chapter, section or provision.

Legislative History: [41-116, added 1961, ch. 330, sec. 16, p. 645.]

I.C. § 41-117: Penalty for transacting insurance without proper licensing¶

41-117A. Penalty for transacting insurance without proper licensing. The director may impose an administrative penalty not to exceed fifteen thousand dollars ($15,000), for deposit in the general account of the state of Idaho, upon any person who transacts insurance of any kind or character or transmits for a person, other than himself, an application for a policy of insurance without proper licensing, or after such licensing shall have been suspended or revoked.

Legislative History: [41-117A, added 1988, ch. 169, sec. 1, p. 299.]

I.C. § 41-118: "Chapter" defined¶

As used in this code and except as otherwise required by context, "chapter" means a particular numbered chapter of this code as indicated by context.

Legislative History: [41-118, added 1961, ch. 330, sec. 804, p. 645.]

I.C. § 41-119: Applicability of code under unrepealed laws¶

Any laws of Idaho, other than this code, remaining in force after the effective date of this code which refer to certain provisions of law repealed under section 809 of this act, shall be deemed to refer to those provisions of this code which are in substance the same or substantially the same as such repealed provisions.

Legislative History: [41-119, added 1961, ch. 330, sec. 805, p. 645.]

I.C. § 41-120: Charitable gift annuities¶

(1) As used in this section:

(a) "Charitable gift annuity" means a transfer of cash or other property by a donor to a charitable organization in return for an annuity payable over one (1) or two (2) lives, under which the actuarial value of the annuity is less than the value of the cash or other property transferred and the difference in value constitutes a charitable deduction for federal tax purposes.

(b) "Charitable organization" means an entity described by sections 501(c)(3) or 170(c) of the internal revenue code of 1986 (26 U.S.C. 501(c)(3) or 170(c)).

(c) "Qualified charitable gift annuity" means a charitable gift annuity described in sections 501(m)(5) and 514(c)(5) of the internal revenue code of 1986 (26 U.S.C. 501(m)(5) and (514(c)(5)), that is issued by a charitable organization that, on the date of the annuity agreement:

(i) Has a minimum of one hundred thousand dollars ($100,000) (after being adjusted annually by the department for inflation, beginning on July 1, 1997, by reference to the city index of the consumer price index or some equivalent measure) in unrestricted cash, cash equivalents, or publicly traded securities, exclusive of the assets funding the annuity agreement; and

(ii) Has been in continuous operation for at least three (3) years or is a successor or affiliate of a charitable organization that has been in continuous operation for at least three (3) years.

(2) It is hereby declared that the issuance of a qualified charitable gift annuity does not constitute engaging in the business of insurance in this state. A charitable gift annuity issued before July 1, 1996, is a qualified charitable gift annuity for purposes of this section and the issuance of such a charitable gift annuity does not constitute engaging in the business of insurance in this state.

(3) When entering into an agreement for a qualified charitable gift annuity, the charitable organization shall disclose in writing to the donor, in the annuity agreement, that a qualified charitable gift annuity is not insurance under the laws of this state and is not subject to regulation by the department of insurance or protected by a guaranty association affiliated with the department. The notice provisions of this subsection must be written in a separate paragraph in the annuity agreement in a print size no smaller than that employed in the annuity agreement generally.

(4) A charitable organization that issues qualified charitable gift annuities shall notify the department in writing within ninety (90) days after the effective date of this section, or on the date on which it enters into the organization’s first qualified charitable gift annuity agreement, whichever is later. Notice to the department must:

(a) Be signed by the officer or director of the charitable organization;

(b) Identify the charitable organization;

(c) Certify that:

(i) The organization is a charitable organization;

(ii) The annuities issued by the charitable organization are qualified charitable gift annuities as defined in this section.

The organization shall not be required by the department to submit additional information except to enable the department to determine appropriate penalties that may be applicable under subsection (5) of this section.

(5) The failure of a charitable organization to comply with the notice requirements imposed by this section does not prevent a charitable gift annuity that otherwise meets the requirements of this section from constituting a qualified charitable gift annuity. However, the director of the department may enforce performance of the notice requirements of this section by sending a letter by certified mail, return receipt requested, demanding that the charitable organization comply with the requirements of subsections (3) and (4) of this section. The department may fine the charitable organization in an amount not to exceed one thousand dollars ($1,000) per qualified charitable gift annuity agreement issued until the charitable organization complies with subsections (3) and (4) of this section.

(6) It is hereby declared that the issuance of a qualified charitable gift annuity does not constitute an unfair or deceptive act or practice in the conduct of trade or commerce prohibited by chapter 6, title 48 , Idaho Code.

Legislative History: [41-120, added 1996, ch. 409, sec. 2, p. 1355.]

I.C. § 41-121: EXEMPTION OF HEALTH CARE SHARING MINISTRIES FROM THE INSURANCE CODE¶

(1) A health care sharing ministry shall not be considered to be engaging in the business of insurance for purposes of this title.

(2) As used in this section, "health care sharing ministry" means a faith-based nonprofit organization that is tax exempt under the Internal Revenue Code which:

(a) Limits its participants to those who are of a similar faith;

(b) Acts as a facilitator among participants who have financial or medical needs and matches those participants with other participants with the present ability to assist those with financial or medical needs in accordance with criteria established by the health care sharing ministry;

(c) Provides for the financial or medical needs of a participant through contributions from one (1) participant to another;

(d) Provides amounts that participants may contribute with no assumption of risk or promise to pay among the participants and no assumption of risk or promise to pay by the health care sharing ministry to the participants;

(e) Provides a written monthly statement to all participants that lists the total dollar amount of qualified needs submitted to the health care sharing ministry, as well as the amount actually published or assigned to participants for their contribution; and

(f) Provides a written disclaimer on or accompanying all applications and guideline materials distributed by or on behalf of the organization that reads, in substance: "Notice: The organization facilitating the sharing of medical expenses is not an insurance company, and neither its guidelines nor plan of operation is an insurance policy. Whether anyone chooses to assist you with your medical bills will be totally voluntary because no other participant will be compelled by law to contribute toward your medical bills. As such, participation in the organization or a subscription to any of its documents should never be considered to be insurance. Regardless of whether you receive any payment for medical expenses or whether this organization continues to operate, you are always personally responsible for the payment of your own medical bills."

(3) It is hereby declared that participation in or operation of a health care sharing ministry does not constitute an unfair or deceptive act or practice in the conduct of trade or commerce prohibited by chapter 6, title 48 , Idaho Code.

Legislative History: [41-121, added 2013, ch. 156, sec. 2, p. 369.]

Chapter 2¶

I.C. § 41-201: Department of insurance¶

There is hereby created the department of insurance of the state of Idaho. The department shall, for the purposes of section 20, article IV, of the Constitution of the state of Idaho, be an executive department of the state government. The department of insurance shall be composed of such divisions and units as authorized by the provisions of section 41-206 , Idaho Code.

Legislative History: [41-201, added 1961, ch. 330, sec. 18, p. 645; am. 1974, ch. 11, sec. 1, p. 60; am. 1981, ch. 264, sec. 1, p. 560; am. 1995, ch. 135, sec. 1, p. 586.]

I.C. § 41-202: Director — Appointment — Term — Qualifications¶

(1) The director of the department of insurance shall be the chief executive officer of the department of insurance.

(2) The director shall be appointed by the governor and shall hold office for a term of four (4) years, subject to earlier removal by the governor. A vacancy in the office of director shall be filled for the balance of the unexpired term only.

(3) The governor shall not appoint as director any individual, and no individual shall hold the office of director, who is not qualified therefor as follows:

(a) Must be a qualified elector of the state of Idaho; and

(b) Must have had at least five (5) years’ practical experience in one or more of the types of insurance business subject to regulation by the director, or have had other professional or business experience reasonably adequate in character and scope to equip him to discharge the duties and fulfill the responsibilities of the office of director.

Legislative History: [41-202, added 1961, ch. 330, sec. 19, p. 645; am. 1974, ch. 11, sec. 2, p. 60.]

I.C. § 41-203: Terms construed¶

Wherever the words "commissioner of insurance" or "insurance commissioner" appear in title 41 , Idaho Code, or elsewhere in the Idaho Code, they shall be understood and construed to mean the director of the department of insurance.

Legislative History: [41-203, added 1961, ch. 330, sec. 20, p. 645; am. 1974, ch. 11, sec. 3, p. 60.]

I.C. § 41-204: Director’s oath and bond¶

At the time of taking office the director shall take an oath of office, and give bond in favor of the state of Idaho in the time, form and manner prescribed in chapter 8, title 59 , Idaho Code. The oath shall be filed with the secretary of state.

Legislative History: [41-204, added 1961, ch. 330, sec. 21, p. 645; am. 1969, ch. 214, sec. 1, p. 625; am. 1971, ch. 136, sec. 28, p. 522.]

I.C. § 41-205: Official seal¶

(1) The director shall have an official seal, in the form and design as so in use immediately prior to the effective date of this code.

(2) The director shall issue under his official seal all certificates, other than licenses of agents, brokers, adjusters, and other insurance representatives, to be issued by him under the laws of this state.

Legislative History: [41-205, added 1961, ch. 330, sec. 22, p. 645.]

I.C. § 41-206: Divisions and employees¶

(1) The department shall be organized into such divisions and such other units as may be administratively established in order to efficiently administer the department. Each division shall be headed by a division administrator who shall be appointed by and serve at the pleasure of the director, and shall be a nonclassified employee exempt from the provisions of chapter 53, title 67 , Idaho Code.

(2) The director may pursuant to chapter 53, title 67 , Idaho Code, appoint, employ, fix the compensation of, prescribe and require the duties of and discharge such employees as the duties of his office may require.

(3) The director may contract for and procure on a basis of fee and without giving such persons any status as an employee of this state, such independently contracting actuarial, technical, examining, and other similar professional services as the director may from time to time require for the discharge of his duties.

Legislative History: [41-206, added 1981, ch. 264, sec. 3, p. 560; am. 1995, ch. 135, sec. 2, p. 586.]

I.C. § 41-207: Delegation of powers¶

(1) The director may delegate to his deputy, assistant, counsel, actuary, examiner or employee, the exercise or discharge in the director’s name of any power, duty, or function, whether ministerial, discretionary or of whatever character, vested in or imposed upon the director under this code.

(2) The official act of any such person so acting in the director’s name and by his authority shall be deemed to be an official act of the director.

Legislative History: [41-207, added 1961, ch. 330, sec. 24, p. 645.]

I.C. § 41-208: Prohibited interests, rewards¶

(1) The director or any deputy, actuary, examiner, assistant or employee of the director shall not be a director, officer, or employee of any insurer or be financially interested in the business of any insurer, except as a policyholder or claimant under an insurance policy or by reason of rights theretofore vested in commissions, fees, or retirement benefits related to services theretofore performed; nor shall any such individual engage in any other business or occupation interfering with or inconsistent with the duties of his office or employment, or serve on or under any political committee or take an active part in any political campaign on behalf of any candidate or party; that as to matters wherein a conflict of interests does not exist on the part of any such individual, the director may employ or retain from time to time insurance actuaries, examiners, accountants, attorneys or other technicians who are independently practicing their professions even though from time to time similarly employed or retained by insurers or others.

(2) Except as provided in section 41-209 , no person shall directly or indirectly give or pay to the director, or any deputy, actuary, examiner, assistant or employee of the director, and the director or his deputy, actuary, examiner, assistant or employee shall not directly or indirectly receive or accept, any fee, compensation, loan, gift, or other thing of value in addition to the compensation and expense allowance provided by law, for any service rendered or to be rendered as such director, deputy, actuary, examiner, assistant or employee or in connection therewith, or for services rendered or to be rendered in relation to legislation, or for extra services rendered or to be rendered, or for any cause whatsoever related, to any person who is subject to the supervision of the director under this code.

(3) Subsections (1) and (2) shall not be deemed to prohibit:

(a) Receipt by any such individual of fully vested commissions or fully vested retirement benefits to which he is entitled by reason of services performed prior to becoming director or prior to employment by the director; or

(b) Investment in shares of regulated diversified investment companies; or

(c) Mortgage loans made under customary terms and in the ordinary course of business.

Legislative History: [41-208, added 1961, ch. 330, sec. 25, p. 645; am. 1969, ch. 214, sec. 3, p. 625.]

I.C. § 41-209: Professional services¶

(1) Upon a domestic insurer’s written request to the director, the director may authorize an examiner, actuary, or other insurance technician appointed or employed by the director, to render to the insurer such professional or technical services as may not otherwise be reasonably obtainable from professional sources within this state.

(2) Compensation for services so actually rendered shall be in such reasonable amount as may be agreed upon between the insurer and the individual performing the services. Such individual shall file a copy of his statement for services with the director before delivery of the same to the insurer or payment thereof.

Legislative History: [41-209, added 1961, ch. 330, sec. 26, p. 645.]

I.C. § 41-210: General powers, duties¶

(1) The director shall enforce the provisions of this code, and shall execute the duties imposed upon him by this code.

(2) The director shall have the powers and authority expressly conferred upon him by or reasonably implied from the provisions of this code.

(3) The director may conduct such examinations and investigations of insurance matters, in addition to examinations and investigations expressly authorized, as he may deem proper to determine whether any person has violated any provision of this code or to secure information useful in the lawful administration of any such provision. The cost of such additional examinations and investigations shall be borne by the state.

(4) For any document required to be filed with the director or the department of insurance under the laws of this state, the director may specify the place and manner of filing of the document, including whether an electronic or paper filing is required or acceptable.

(5) The director shall have such additional powers and duties as may be provided by other laws of this state.

Legislative History: [41-210, added 1961, ch. 330, sec. 27, p. 645; am. 2004, ch. 238, sec. 1, p. 701.]

I.C. § 41-211: Rules¶

(1) The director may make reasonable rules necessary for or as an aid to the effectuation of any provision of this code. No such rule shall extend, modify, or conflict with any law of this state or the reasonable implications thereof.

(2) Any such rule affecting persons or matters other than the personnel or the internal affairs of the department shall be made or amended in accordance with the provisions of chapter 52, title 67 , Idaho Code.

(3) In addition to any other penalty provided, wilful violation of any such rule shall subject the violator to such suspension or revocation of certificate of authority or license as may be applicable under this code as for violation of the provision as to which such rule relates.

Legislative History: [41-211, added 1961, ch. 330, sec. 28, p. 645; am. 1994, ch. 310, sec. 1, p. 977.]

I.C. § 41-212: Orders, notices¶

(1) Orders and notices of the director shall be effective only when in writing signed by him or by his authority.

(2) Every such order shall state its effective date, and shall concisely state:

(a) Its intent or purpose.

(b) The grounds on which based.

(c) The provisions of this code pursuant to which action is taken or proposed to be taken; but failure to so designate a particular provision shall not deprive the director of the right to rely thereon.

(3) Except as may be provided in this code respecting particular procedures, an order or notice may be given by:

(a) Personal service upon the person to be ordered or notified;

(b) Mailing it, postage prepaid, by regular United States mail, or by certified mail, return receipt requested, addressed to the person at his residence or principal place of business as last of record in the department; or

(c) Where a party has appeared in a contested case or has not yet appeared but has consented or agreed in writing to service by facsimile transmission (FAX) or e-mail as an alternative to personal service or service by mail, such orders or notices may be served by FAX or by e-mail in lieu of service by mail or personal service.

(4) Service of orders and notices is complete when a copy is personally served upon the person to be served, or when a copy properly addressed and postage prepaid is deposited in the United States mail or the statehouse mail, if the person is a state employee or state agency, or when there is an electronic verification that a FAX or an e-mail has been sent.

Legislative History: [41-212, added 1961, ch. 330, sec. 29, p. 645; am. 2012, ch. 157, sec. 1, p. 433.]

I.C. § 41-213: Enforcement¶

(1) The director may institute such suits or other lawful proceedings as he may deem necessary for the enforcement of any provision of title 41 , Idaho Code. If the director believes that any person has engaged in or is about to engage in any act or practice constituting a violation of any provision of title 41 , Idaho Code, any other law the director has authority to enforce, or any rule or order of the director, the director may, in accordance with the procedures set forth in title 41 , Idaho Code, and chapter 52, title 67 , Idaho Code:

(a) Issue an order requiring the person to cease and desist from any prohibited act or practice;

(b) Issue an order affecting a person’s license for such reasons as set forth in title 41 , Idaho Code;

(c) Issue an order imposing an administrative penalty as provided in title 41 , Idaho Code; and

(d) Initiate any action in district court for the same relief or any relief authorized by title 41 , Idaho Code.

(2) If the director believes that any person is violating or about to violate any provision of title 41 , Idaho Code, or any order or requirement of the director issued or promulgated pursuant to authority expressly granted the director by any provision of title 41 , Idaho Code, or by other law, the director may bring an action against such person in the name of the people of the state of Idaho in a district court of this state to enjoin such person from continuing such violation or doing any act in furtherance thereof. In the action the court may enter such order or judgment granting such preliminary or final injunction as the court determines to be proper.

(3) If the director has reason to believe that any person has violated any provision of title 41 , Idaho Code, or any provision of other law as applicable to insurance operations, for which criminal prosecution is provided and would be in order, he shall give the information relative thereto to the attorney general or county attorney having jurisdiction of any such violation. The attorney general or county attorney shall promptly institute such action or proceedings against such person as the information may require or justify.

(4) Whenever the director may deem it necessary, he shall employ counsel, or call upon the attorney general of this state for legal counsel and such assistance as may be necessary.

Legislative History: [41-213, added 1961, ch. 330, sec. 30, p. 645; am. 1972, ch. 369, sec. 2, p. 1072; am. 2005, ch. 78, sec. 1, p. 271.]

I.C. § 41-214: Records — Reproduction — Destruction¶

(1) The director shall preserve in permanent form records of his proceedings and hearings and including a concise statement of the results of any investigations or examinations of insurers, and shall file such records in the department.

(2) The records and insurance filings in the department shall be open to public inspection, except as otherwise provided by this code.

(3) The director may photograph, microphotograph or reproduce on film, whereby each page will be reproduced in exact conformity with the original except as to dimensions, financial statements of insurers, reports of business transacted in this state by foreign insurers, reports of examination of insurers, and such records and documents on file in his office as he may in his discretion select.

(4) The director may destroy unneeded or obsolete records and filings of the department in accordance with provisions and procedures applicable to administrative agencies of this state in general.

Legislative History: [41-214, added 1961, ch. 330, sec. 31, p. 645.]

I.C. § 41-215: Use of reproductions and certified copies as evidence¶

(1) Photographs or microphotographs in the form of film or prints of documents and records made under section 41-214 (3) shall have the same force and effect as the originals thereof, and duly certified or authenticated reproductions of such photographs or microphotographs shall be as admissible in evidence as are the originals.

(2) Upon request of any person and payment of the applicable fee, the director shall furnish a certified copy of any record in his office which is then subject to public inspection.

(3) Copies of original records or documents in his office certified by the director shall have the same effect and force and be received in evidence in all courts equally and in like manner as if they were originals.

Legislative History: [41-215, added 1961, ch. 330, sec. 32, p. 645.]

I.C. § 41-216: Director’s annual report¶

As early after July 1 as is consistent with full and accurate preparation the director annually shall transmit to the governor a report of his official transactions containing with respect to the calendar year next preceding:

(1) A list of all authorized insurers transacting insurance in this state, showing as to each insurer the name, location, amount of capital (if a stock insurer) or surplus (if a mutual or reciprocal insurer), date of incorporation or formation, date of commencement of business, and kinds of insurance transacted.

(2) A condensed form of financial statements and reports of every authorized insurer for the calendar year, as audited and corrected by the director, arranged in tabular form or in abstracts.

(3) A list of insurers whose business in this state was terminated and the reason for such termination; and if such termination was a result of liquidation, or of delinquency proceedings brought against the insurer in this or any other state, the amount of the insurer’s assets and liabilities so far as the same are known to the director.

(4) A statement of the operating expenses of the department, including salaries, transportation, communication, printing, office supplies, fixed charges (insurance and bonds) and miscellaneous expense.

(5) A detailed statement of the moneys and fees received by the department and from what source.

(6) Any recommendations for amendments or supplementations to insurance laws which, in the director’s opinion, may be desirable.

(7) Such other pertinent information and matters as the director deems to be in the public interest.

Legislative History: [41-216, added 1961, ch. 330, sec. 34, p. 645.]

I.C. § 41-217: Publications authorized¶

The director shall publish, by printing or other suitable form of reproduction:

(1) Pamphlet or booklet copies of the insurance laws of this state;

(2) The director’s annual report;

(3) Such copies of results of investigations or examinations of insurers for public distribution as he deems to be in the public interest;

(4) Such compilations as he deems advisable from time to time of the general orders of the director then in force; and

(5) Such other material as he may compile and deem relevant and suitable for the more effective administration of this code.

Legislative History: [41-217, added 1961, ch. 330, sec. 34, p. 645.]

I.C. § 41-218: Publications — Sale¶

(1) The director shall fix a price at not less than cost of distribution and printing or other reproduction, to be paid by persons requesting copies of the insurance laws and such other publications referred to in section 41-217 as he deems proper to sell on behalf of the state rather than distribute free of charge on a basis of reciprocity.

(2) The director shall account for and deposit all moneys so received in the same manner as applies under section 41-406 to fees and taxes collected by him.

Legislative History: [41-218, added 1961, ch. 330, sec. 35, p. 645.]

I.C. § 41-219: Examination of insurers¶

(1) For the purpose of determining its financial condition, ability to fulfill and manner of fulfillment of its obligations, the nature of its operations, and compliance with the law, the director shall examine the affairs, transactions, accounts, records, and assets of each authorized insurer, including the attorney in fact of a reciprocal insurer in so far as insurer transactions are concerned, as often as he deems advisable. The director or any of the director’s examiners may conduct an examination, in accordance with the provisions of this section, of any company as often as the director in his sole discretion deems appropriate but shall, at a minimum, conduct an examination of every insurer licensed in this state not less frequently than once every five (5) years. In scheduling and determining the nature, scope and frequency of the examinations, the director shall consider such matters as the results of financial statement analyses and ratios, changes in management or ownership, actuarial opinions, reports of independent certified public accountants and other criteria as set forth in the examiners’ handbook adopted by the national association of insurance commissioners and in effect when the director exercises discretion under the provisions of this section.

(2) Examination of an alien insurer shall be limited to its insurance transactions, assets, trust deposits and affairs in the United States except as otherwise required by the director.

(3) The director shall in like manner examine each insurer applying for an initial certificate of authority to transact insurance in this state.

(4) In lieu of an examination under the provisions of this section, of any foreign or alien insurer licensed in this state, the director may accept an examination report on the company as prepared by the insurance department for the company’s state of domicile or port of entry until January 1, 1994. Thereafter, such reports may only be accepted if the insurance department was at the time of the examination accredited under the national association of insurance commissioners’ financial regulation standards and accreditation program or, the examination is performed under the supervision of an accredited insurance department or with participation of one (1) or more examiners who are employed by such an accredited state insurance department and who, after a review of the examination work papers and report, state under oath that the examination was performed in a manner consistent with the standards and procedures required by their insurance department.

(5) The term "company" as used in this section shall mean any person engaging in or proposing or attempting to engage in any transaction or kind of insurance or surety business and any person or group of persons who may otherwise be subject to the administrative, regulatory or taxing authority of the director.

Legislative History: [41-219, added 1961, ch. 330, sec. 36, p. 645; am. 1993, ch. 194, sec. 1, p. 494.]

I.C. § 41-220: Examination of agents, brokers, consultants, managers, adjusters, promoters¶

For the purpose of ascertaining compliance with law, and in addition to any right of examination otherwise provided, the director may as often as he deems advisable examine the accounts, records, documents, and transactions, pertaining to or affecting its insurance affairs or proposed insurance affairs, of: (1) any insurance agent, broker, solicitor, consultant, surplus line broker, general agent, or adjuster.

(2) Any person(s) having a contract under which he enjoys in fact the exclusive or dominant right to manage or control an insurer.

(3) Any person holding the shares of voting stock or policyholder proxies of a domestic insurer, for the purpose of controlling the management thereof, as voting trustee or otherwise.

(4) Any person engaged in this state in, or proposing to be engaged in this state in, or holding himself out in this state as so engaging or proposing, or in this state assisting in, the promotion or formation of an insurer or insurance holding corporation, or corporation to finance an insurer or the production of its business.

Legislative History: [41-220, added 1961, ch. 330, sec. 37, p. 645; am. 1972, ch. 369, sec. 3, p. 1072.]

I.C. § 41-221: Place of examination¶

(1) The examination may be conducted by the director or his accredited examiners at the offices wherever located of the person being examined and at such other places as may be required for determination of matters under examination.

(2) In the case of alien insurers the examination may be so conducted in the insurer’s United States offices and at places within the United States, except as otherwise required by the director.

Legislative History: [41-221, added 1961, ch. 330, sec. 38, p. 645.]

I.C. § 41-222: Examination cooperation with other states¶

As far as practical the director shall conduct the examination of a foreign or alien insurer in cooperation with the insurance supervisory officials of other states in which the insurer transacts business, and for the purpose thereof may participate in joint examinations of insurers or be represented in an examination by an examiner of another state.

Legislative History: [41-222, added 1961, ch. 330, sec. 39, p. 645.]

I.C. § 41-223: Conduct of examination — Access to records — Correction of accounts — Removal of records¶

(1) Upon determining that an examination should be conducted, the director or the director’s designee shall issue an examination warrant appointing one (1) or more examiners to perform the examination and instructing them as to the scope of the examination. In conducting the examination, the examiner shall observe those guidelines and procedures set forth in the examiners’ handbook adopted by the national association of insurance commissioners. The director may also employ such other guidelines or procedures as the director may deem appropriate.

(2) Upon such examination the director or examiner may examine under oath any officer, agent, or other individual deemed to have material information regarding the affairs of the person under examination.

(3) Every person being examined, its officers, attorneys, employees, agents, representatives or others having custody or control thereof, shall make freely available to the director or his examiners the accounts, records, documents, files, information, assets and matters in his possession or control relating to the subject of the examination, and shall facilitate the examination.

(4) If the director finds any accounts or records to be inadequate or incorrectly kept or posted, he may procure the services of competent persons to reconstruct, rewrite, post or balance them at the expense of the person being examined if such person has failed to maintain, complete or correct such records or accounts after the director has given him notice and a reasonable opportunity to do so.

(5) Neither the director nor any examiner shall remove any record, account, document, file or other property of the person being examined from the offices of such person except with the written consent of such person being given in advance of such removal, or pursuant to an order of court duly obtained. This provision shall not be deemed to affect the making and removal of copies or abstracts of any such record, account, document, or file.

(6) Nothing contained in this chapter shall be construed to limit the director’s authority to terminate or suspend any examination in order to pursue other legal or regulatory action pursuant to the insurance laws of this state.

(7) Nothing contained in this chapter shall be construed to limit the director’s authority to use any final examination report, or to use any examiner or company work papers or other documents, or any other information discovered or developed during the course of any examination in any judicial proceeding or administrative proceeding under this chapter.

Legislative History: [41-223, added 1961, ch. 330, sec. 40, p. 645; am. 1993, ch. 194, sec. 2, p. 495; am. 1995, ch. 136, sec. 1, p. 587.]

I.C. § 41-224: Examination — Appraisal of asset¶

(1) If the director deems it necessary to value any asset involved in such an examination, he may make written request of the person being examined to appoint one or more appraisers who by reason of education, experience or special training are competent to appraise such asset. Any such appraiser shall be subject to the written approval of the director. If no such appointment is made within ten (10) days after the request therefor was delivered to such person, the director may appoint the appraiser or appraisers.

(2) Any such appraisal shall be promptly made, and a copy of the report thereof shall be furnished to the director.

(3) The reasonable expense of the appraisal shall be borne by the person being examined.

Legislative History: [41-224, added 1961, ch. 330, sec. 41, p. 645.]

I.C. § 41-225: Obstruction of examination — Penalty¶

Any individual who wilfully obstructs the director or his examiner in the conduct of any examination authorized by this chapter shall be guilty of a misdemeanor and upon conviction shall be punished as provided in section 41-117 (general penalty).

Legislative History: [41-225, added 1961, ch. 330, sec. 42, p. 645.]

I.C. § 41-226: Examiners — Qualifications¶

For the conduct of or assistance in examinations under this chapter the director shall appoint as examiners only individuals who by reason of education, experience, or special training are competent to perform the duties and fulfill the responsibilities of an insurance examiner. In the selection of examiners the director shall give due consideration to standards and qualifications therefor recommended by the National Association of Insurance Commissioners or any successor organization thereto. The director may appoint, employ, fix the compensation of, prescribe and require the duties of and discharge such examiners as the duties of his office may require. Examiners who are employees of the department shall be nonclassified employees exempt from the provisions of chapter 53, title 67 , Idaho Code.

Legislative History: [41-226, added 1961, ch. 330, sec. 43, p. 645; am. 1995, ch. 135, sec. 3, p. 587; am. 2003, ch. 99, sec. 1, p. 318.]

I.C. § 41-227: Examination report¶

(1) The director or his examiner shall make a full and true written report of every examination made by him under this chapter, and shall verify the report by his oath.

(2) The report shall comprise only facts appearing upon the books, papers, records or documents of the person being examined, or ascertained from testimony of individuals under oath concerning the affairs of such person, together with such conclusions and recommendations as may reasonably be warranted from such facts.

(3) Prior to a hearing and prior to any modifications the report shall be subject to disclosure according to chapter 1, title 74 , Idaho Code.

(4) No later than sixty (60) days following completion of the examination, the examiner in charge shall file with the department a verified written report of examination under oath. Upon receipt of the verified report, the department shall transmit the report to the company examined, together with a notice which shall afford the company examined a reasonable opportunity of not more than thirty (30) days to make a written submission or rebuttal with respect to any matters contained in the examination report.

(5) Within thirty (30) days of the end of the period allowed for the receipt of written submissions or rebuttals, the director shall fully consider and review the report, together with any written submissions or rebuttals and any relevant portions of the examiner’s work papers, and enter an order:

(a) Adopting the examination report as filed or with modifications or corrections. If the examination report reveals that the company is operating in violation of any law, regulation or prior order of the director, the director may order the company to take any action the director considers necessary and appropriate to cure such violation;

(b) Rejecting the examination report with directions to the examiners to reopen the examination for purposes of obtaining additional data, documentation or information, and refiling pursuant to subsection (2) of this section; or

(c) Calling for an investigatory hearing with no less than twenty (20) days’ notice to the company for purposes of obtaining additional documentation, data, information and testimony.

(6) (a) All orders entered pursuant to subsection (5)(a) of this section shall be accompanied by findings and conclusions resulting from the director’s consideration and review of the examination report, relevant examiner work papers and any written submissions or rebuttals. Any such order shall be considered a final order and may be appealed pursuant to sections 67-5270 through 67-5279 , Idaho Code, and shall be served upon the company by certified mail, together with a copy of the adopted examination report. Within thirty (30) days of the issuance of the adopted report, the company shall file affidavits executed by each of its directors stating under oath that they have received a copy of the adopted report and related orders.

(b) Any hearing conducted under subsection (5)(c) of this section by the director or authorized representative, shall be conducted in accordance with the provisions of chapter 52, title 67 , Idaho Code, as a nonadversarial confidential investigatory proceeding as necessary for the resolution of any inconsistencies, discrepancies or disputed issues apparent upon the face of the filed examination report or raised by, or as a result of, the director’s review of relevant work papers or by the written submission or rebuttal of the company. Within twenty (20) days of the conclusion of any such hearing, the director shall enter an order pursuant to the provisions of subsection (5)(a) of this section.

(c) The director shall not appoint a contract examiner or an employee of the department as an authorized representative to conduct the hearing.

Nothing contained in this section shall require the department to disclose any information or records which would indicate or show the content of any investigation or activity of a criminal justice agency, except to the extent that the director relied upon information furnished to the director by such criminal justice agency in making his decision.

(7) The report when so verified and filed shall be admissible in evidence in any action or proceeding brought by the director against the person examined, or against its officers, employees or agents, and shall be presumptive evidence of the material facts stated therein. The director or his examiners may at any time testify and offer other proper evidence as to information secured or matters discovered during the course of an examination, whether or not a written report of the examination has been either made, furnished or filed in the department.

(8) After an order is entered under the provisions of subsection (5)(a) of this section, the director may publish the report or the results of the examination as contained therein which report or results are a public record and shall be exempt from the exemptions from disclosure provided in chapter 1, title 74 , Idaho Code.

(9) Nothing contained in this chapter shall prevent or be construed as prohibiting the director from disclosing the content of an examination report, preliminary examination report or results, or any matter relating thereto, to the insurance department of this or any other state or country, or to law enforcement officials of this or any other state or agency of the federal government at any time, so long as the agency or office receiving the report or matters relating thereto agrees in writing to hold it confidential and in a manner consistent with this chapter.

(10) All working papers, recorded information, documents and copies thereof produced by, obtained by or disclosed to the director or any other person in the course of an examination made under the provisions of this chapter shall be made available to the person or company which was the subject of the examination in proceedings pursuant to chapter 52, title 67 , Idaho Code, but shall otherwise be held by the director as a record not required to be made public pursuant to exemptions from disclosure provided in chapter 1, title 74 , Idaho Code.

Legislative History: [41-227, added 1961, ch. 330, sec. 44, p. 645; am. 1990, ch. 213, sec. 52, p. 522; am. 1993, ch. 194, sec. 3, p. 496; am. 1995, ch. 136, sec. 2, p. 588; am. 1996, ch. 95, sec. 1, p. 280; am. 1999, ch. 30, sec. 10, p. 52; am. 2015, ch. 141, sec. 105, p. 454.]

I.C. § 41-228: Examination expense¶

(1) Every insurer or corporation so examined shall, at the direction of the director, pay the actual travel expenses, reasonable living expense allowance, and compensation, at reasonable rates customary for such examination and as approved by the director, necessarily incurred on account of the examination, upon presentation of a detailed account of such charges and expenses.

(2) No person shall pay and no examiner shall accept any additional emolument on account of any examination.

(3) An insurer shall be entitled to offset against its premium taxes payable to the department of insurance of the state of Idaho the examination expense paid by it to or for the account of an examiner, actuary, or other assistant designated by the director for the purpose of the examination, inclusive of such personnel as may be so designated on behalf of other states participating in any such examination. The offset, or any remaining portion thereof, will be allowed for any of the five (5) calendar years following the year in which such examination expense was paid.

Legislative History: [41-228, added 1961, ch. 330, sec. 45, p. 645; am. 1969, ch. 214, sec. 4, p. 625; am. 1975, ch. 207, sec. 1, p. 575; am. 1980, ch. 133, sec. 1, p. 292; am. 1984, ch. 100, sec. 1, p. 228; am. 1994, ch. 267, sec. 1, p. 825; am. 2001, ch. 85, sec. 1, p. 211.]

I.C. § 41-229: Witnesses and evidence¶

(1) As to the subject of any examination, investigation, or hearing being conducted by him the director or any deputy or examiner appointed by him may administer oaths, examine and cross-examine witnesses, receive oral and documentary evidence, and shall have the power to subpoena witnesses, compel their attendance and testimony, and require by subpoena the production of books, papers, records, files, correspondence, documents and other evidence which he deems relevant to the inquiry.

(2) If any individual refuses to comply with any such subpoena or to testify as to any matter concerning which he may be lawfully interrogated, the district court of the county wherein such examination, investigation, or hearing is being conducted or of the county wherein such individual resides, on the director’s application may issue an order requiring such individual to comply with the subpoena and to testify; and failure to obey such an order may be punished by the court as a contempt thereof.

(3) Subpoenas shall be served, and proof of such service made, in the same manner as if issued by a district court. Witness fees and mileage, if claimed, shall be allowed the same as for testimony in a district court.

(4) Any individual wilfully testifying falsely under oath as to any matter material to any such examination, investigation or hearing shall upon conviction thereof be guilty of perjury and shall be punished accordingly.

Legislative History: [41-229, added 1961, ch. 330, sec. 46, p. 645.]

I.C. § 41-230: Testimony compelled — Immunity from prosecution¶

(1) If any person asks to be excused from attending or testifying or from producing any books, papers, records, contracts, documents, or other evidence in connection with any examination, hearing, or investigation being conducted by the director, his deputy or examiner, or in any proceeding or action before any court or magistrate upon a charge of violation of this code, on the ground that the testimony or evidence required of him may tend to incriminate him or subject him to a penalty or forfeiture, and shall notwithstanding be directed to give such testimony or produce such evidence, he must, if so directed by the director and the attorney general, nonetheless comply with such direction; and he shall not be exempt from the refusal, suspension, or revocation of any license, permission, or authority conferred, or to be conferred, pursuant to this code. After complying, and if, but for this section, he would have been privileged to withhold the answer given or the evidence produced by him, the answer given, or evidence produced, and any information directly or indirectly derived from the answer or evidence, may not be used against the compelled person in any manner in a criminal case, except that he may nevertheless be prosecuted or subjected to penalty or forfeiture for any perjury, false swearing or contempt committed in answering or failing to answer, or in producing or failing to produce, evidence in accordance with the order.

(2) Any such individual may execute, acknowledge and file in the department a statement expressly waiving such immunity or privilege in respect to any transaction, matter or thing specified in such statement, and thereupon the testimony of such individual or such evidence in relation to such transaction, matter, or thing may be received or produced before any judge or justice, court, tribunal, magistrate, grand jury or otherwise, and if so received or produced such individual shall not be entitled to any immunity or privileges on account of any testimony he may so give or evidence so produced.

Legislative History: [41-230, added 1961, ch. 330, sec. 47, p. 645; am. 2007, ch. 283, sec. 1, p. 813.]

I.C. § 41-231: Hearings and appeal — Scope of provisions¶

Except as otherwise provided in title 41 , Idaho Code, and to the extent not inconsistent therewith, chapter 52, title 67 , Idaho Code, shall apply as to all hearings and as to all appeals from the director relative to any matter treated in this code.

Legislative History: [41-231, added 1961, ch. 330, sec. 48, p. 645; am. 2005, ch. 77, sec. 1, p. 258.]

I.C. § 41-232: Hearings upon the denial, nonrenewal, suspension or revocation of a certificate of authority or license or imposition of administrative penalties¶

41-232A. Hearings upon the denial, nonrenewal, suspension or revocation of a certificate of authority or license or imposition of administrative penalties. (1) In the event the director denies an applicant’s application for a certificate of authority or for a license, the director shall notify the applicant in writing of the basis for the denial. Within twenty-one (21) days of the issuance of the notice of denial, the applicant may submit to the director a written request for a hearing before the director or his duly appointed representative addressing the basis for the denial of the application and requesting that the director reexamine the applicant’s qualifications for a certificate of authority or a license. An applicant’s failure to request a hearing in writing within twenty-one (21) days of the issuance of the notice of denial shall be deemed a waiver of the opportunity for hearing.

(2) Except as otherwise provided in title 41 and chapter 52, title 67 , Idaho Code, prior to the director’s nonrenewal, suspension or revocation of a certificate of authority or license or imposition of any administrative penalty, the director shall provide the insurer or licensee, and any appointing insurers that have appointed the licensee as an agent, with advance written notice of the nature of the violations alleged or the charges pending against the insurer or licensee and affording the insurer or licensee an opportunity for a hearing thereon. Within twenty-one (21) days of the issuance of the notice of violations or charges, the insurer or licensee may submit to the director a written request for a hearing before the director or his duly appointed representative addressing the alleged violations and charges pending against the insurer or licensee. An insurer’s or licensee’s failure to request a hearing or otherwise dispute the notice in writing within twenty-one (21) days of the issuance of the notice of violations or charges shall be deemed a waiver of the opportunity for hearing.

(3) All hearings under this section shall be conducted in accordance with the provisions set forth in this chapter and chapter 52, title 67 , Idaho Code.

Legislative History: [41-232A, added 2006, ch. 49, sec. 1, p. 141.]

I.C. § 41-234: Place of hearing — Admission of public¶

The hearing shall be held at the place designated by the director, and at his discretion it may be open to the public.

Legislative History: [41-234, added 1961, ch. 330, sec. 51, p. 645.]

I.C. § 41-235: Notice of hearing¶

(1) Except where a longer period of notice is provided by other provisions of this code relative to particular matters, not less than fourteen (14) days in advance the director shall give notice of the time and place of the hearing, stating the matters to be considered thereat. If the persons to be given notice are not specified in the provision pursuant to which hearing is held, the director shall give such notice to all persons whose pecuniary interests are to be directly and immediately affected by such hearing.

(2) If any such hearing would otherwise require separate notices to more than one hundred (100) persons, in lieu of the notice required under such subsection the director may give notice of the hearing by publishing the notice in at least three (3), but not to exceed five (5), daily newspapers, at least once each week during the four (4) weeks immediately preceding the week in which the hearing is to be held. The director shall select such newspapers, as to location and circulation, as he deems necessary to give adequate opportunity of notice to such persons as should receive notice of the hearing. The published notice shall state the time and place of the hearing and shall specify the matters to be considered thereat. At the time of first publication the director shall mail to every advisory organization which has filed with him pursuant to section 41-1425 , Idaho Code, a copy of the published notice if the proposed hearing would affect any interest of the members of such advisory organization.

(3) All such notices, other than published notices, shall be given as provided in section 41-212 , Idaho Code.

Legislative History: [41-235, added 1961, ch. 330, sec. 52, p. 645; am. 2005, ch. 77, sec. 3, p. 258.]

I.C. § 41-236: Show cause notice¶

If any person is entitled to a hearing by any provision of the insurance code before any proposed action is taken, the notice of the proposed action may be in the form of a notice to show cause stating that the proposed action may be taken, unless such person shows cause at a hearing to be held as specified in the notice why the proposed action should not be taken, and stating the basis of the proposed action.

Legislative History: [41-236, added 1961, ch. 330, sec. 53, p. 645.]

I.C. § 41-237: Adjourned hearing¶

The director may adjourn any hearing from time to time and from place to place without other notice of the adjourned hearing than announcement thereof at the hearing.

Legislative History: [41-237, added 1961, ch. 330, sec. 54, p. 645.]

I.C. § 41-238: Nonattendance¶

The validity of any hearing held in accordance with the notice thereof shall not be affected by failure of any person to attend or to remain in attendance.

Legislative History: [41-238, added 1961, ch. 330, sec. 55, p. 645.]

I.C. § 41-240: Order on hearing¶

(1) In the conduct of hearings under this code and making his order thereon, the director shall act in a quasi-judicial capacity.

(2) Within thirty (30) days after termination of a hearing and completion of the transcript, if any, or of any rehearing thereof or reargument thereon, or within such other period as may be specified in this code as to particular proceedings, the director shall make his order on hearing and, subject to subsection (5) below, shall give a copy of the order to each person to whom notice of the hearing was given or required to be given and to any other person who became a party to the hearing by intervention.

(3) The order shall contain a concise statement of the facts as found by the director, and of his conclusions therefrom, and the matters required by section 41-212 (orders, notices).

(4) The order may confirm, modify, or nullify action taken under an existing order, or may constitute the taking of any new action coming within the scope of the notice of the hearing.

(5) If notice of the hearing was given by publication as provided for in section 41-235 the director may publish the order on hearing once each week for four (4) consecutive weeks in the same newspapers in which such notice was published, the first such publication to be made on the date of the order. Publication of the order shall be in lieu of the giving of copies of the order as required under subsection (2) above. At time of first publication the director shall mail to every advisory organization which has filed with him pursuant to section 41-1425 , a copy of the published order if the order would affect any interest of members of such advisory organization.

Legislative History: [41-240, added 1961, ch. 330, sec. 57, p. 645.]

I.C. § 41-247: Inquiry powers of director¶

The director shall have power to direct an inquiry in writing to any person subject to his jurisdiction with respect to any insurance transaction or matter relative to a subject of insurance resident, located, or to be performed in this state. The person to whom such an inquiry is addressed shall upon receipt thereof promptly furnish to the director all requested information which is in his possession or subject to his control.

Legislative History: [I.C., sec. 41-247, as added by 1969, ch. 214, sec. 5, p. 625.]

I.C. § 41-248: Interstate relations¶

If the matter that the director seeks to obtain by request is located outside the state, the person so requested may make it available to the director or his representative to examine the matter at the place where it is located. The director may designate representatives, including officials of the state in which the matter is located, to inspect the matter on his behalf, and he may respond to similar requests from officials of other states.

Legislative History: [41-248, added 1981, ch. 23, sec. 1, p. 40.]

I.C. § 41-249: Sharing of information among governmental agencies and the national association of insurance commissioners¶

(1) Any document, report, or other recorded information provided to the director by any federal, state or foreign regulatory or law enforcement agency, or any combination thereof, or by the national association of insurance commissioners (NAIC), which is marked "confidential" or "for regulator use only" or by similar terms or concerning which the entity requires written assurance that the director maintain such information in confidence before the entity will release the information, may be maintained by the director on a confidential basis and is not required to be disclosed to the public.

(2) The director may provide any document, report, or other recorded information to any federal, state or foreign regulatory or law enforcement agency, or any combination thereof, or to the NAIC, which is marked "confidential" or "for regulator use only" or by similar terms or concerning which the director requires written assurance that the entity maintain such information in confidence before he will release it to such entity.

(3) The director is authorized to enter into agreements with other governments, agencies, or any combination thereof, or with the NAIC, in connection with his duties and responsibilities pursuant to this section.

(4) The application of this section shall not prevent an insurance company or producer or other licensee from obtaining information used by the department of insurance in making regulatory decisions or taking regulatory action affecting the company consistent with chapter 1, title 74 , Idaho Code, and title 41 , Idaho Code.

Legislative History: [41-249, added 1994, ch. 309, sec. 1, p. 976; am. 2003, ch. 102, sec. 1, p. 322; am. 2007, ch. 281, sec. 1, p. 812; am. 2015, ch. 141, sec. 106, p. 456.]

I.C. § 41-253: Statement of purpose — Adoption of international fire code¶

(1) The purpose of sections 41-253 through 41-269 , Idaho Code, is to protect human life from fire, and to prevent fires. These sections are intended to prescribe regulations consistent with nationally recognized good practice for the safeguarding of life and property from hazards of fire and explosion arising from the storage, handling and use of hazardous substances, materials, and devices, and from conditions hazardous to life or property in the use or occupancy of buildings or premises, and there is hereby adopted the "International Fire Code," 2000 edition, with appendices thereto, published by the International Code Council, Inc. and such later editions as may be so published and adopted by the state fire marshal, as the minimum standards for the protection of life and property from fire and explosions in the state of Idaho.

(2) A detached single family dwelling, to be constructed upon lands of five (5) acres or more outside an incorporated city and not within a designated area of city impact, shall be exempt from the water supply and access requirements of the adopted version of the International Fire Code unless a county land use or subdivision ordinance requires such compliance. A county adopted ordinance may expand the foregoing exemption applicable to detached single family dwellings by reducing the minimum parcel area requirement after first conducting a public hearing subject to public notice that complies with the requirements set forth in section 67-6509 , Idaho Code, and after providing notice by mail to all fire agencies providing services to areas outside an incorporated city and not within a designated area of city impact that might be affected by any such proposal at least twenty-one (21) days prior to such public hearing.

(3) Assistants to the state fire marshal, as provided in section 41-256 , Idaho Code, shall apply a reasonable interpretation to the International Fire Code as adopted by the state fire marshal, and rules of the state fire marshal, when undertaking any enforcement action.

(4) For the purposes of sections 41-253 through 41-269 , Idaho Code, the "International Fire Code" shall mean the publications as adopted under subsection (1) of this section.

Legislative History: [(41-253) 39-3501 added 1970, ch. 190, sec. 1, p. 547; am. and redesig. 1982, ch. 120, sec. 1, p. 338; am. 2002, ch. 86, sec. 5, p. 198; am. 2008, ch. 402, sec. 1, p. 1106; am. 2010, ch. 219, sec. 1, p. 492.]

I.C. § 41-254: Powers and duties of state fire marshal — International fire code, enforcement and regulations — Reports¶

The state fire marshal shall be appointed by the director of the department of insurance, with the approval of the governor and shall serve at the pleasure of the director. The state fire marshal shall have the following powers and duties:

1. To enforce the international fire code.

2. To prescribe regulations in addition to the international fire code as adopted, which may be deemed necessary for the prevention of fires and protection of life and property, and such regulations are to be enforced by the state fire marshal.

3. To make interpretations and rules of the intent of the various provisions of the international fire code as adopted.

4. To adopt, rescind, modify or amend rules and regulations for the exercise of functional powers and duties.

5. To transmit to the governor and legislature, on or before the 15th day of July of every year, a full report of proceedings under sections 41-253 through 41-269 , Idaho Code, and such statistics as he may wish to include therein unless some other time for reporting is fixed by law, and such report shall be available to the public.

6. To make recommendations for amendments to the international fire code to be submitted to the promulgating authority for its consideration.

7. To have exclusive jurisdiction over single service integrated fire sprinkler systems. A "single service integrated fire sprinkler system" is defined as an integrated system of underground and overhead piping, valves and sprinklers used exclusively for fire protection purposes and designed in accordance with fire protection engineering standards, including the international fire code, beginning with the first connection to a public water system regardless of the existence or location of a back flow prevention device.

8. No person shall be eligible to serve as state fire marshal unless he:

(a) Has had at least twelve (12) years’ full-time paid experience with a state, city or county fire protection agency whose primary function is fire prevention and structural fire safety, including at least five (5) years’ experience in an administrative capacity as the chief agency officer; or

(b) Holds a four (4) year college degree in one of the physical sciences and has had at least five (5) years’ full-time experience in fire protection and structural fire safety with a fire protection agency; or

(c) Is a member of the American society of fire protection engineers.

Legislative History: [(41-254) 1970, ch. 190, sec. 4, p. 547; am. 1974, ch. 39, sec. 45, p. 1023; am. and redesig. 1982, ch. 120, sec. 2, p. 338; am. 1993, ch. 43, sec. 1, p. 115; am. 1993, ch. 128, sec. 2, p. 323; am. 2002, ch. 86, sec. 6, p. 198.]

I.C. § 41-255: Duties of state fire marshal¶

In addition to the duties prescribed in section 41-254 , Idaho Code, the state fire marshal shall:

(1) Administer and enforce this act.

(2) Appoint, employ and discharge such deputies and other employees as in his judgment may be necessary, control their powers, prescribe their duties, and fix their compensation.

(3) Keep books, records and accounts, which shall be open to inspection and audit by the state of Idaho at all times.

(4) Purchase necessary equipment and supplies, and incur any other reasonable and necessary expense in connection with or required for the purpose of carrying out the provisions of this act.

(5) Maintain in his office a record of all fires occurring in the state, and of all the facts concerning the same, including statistics as to the extent of such fires and the damage caused thereby and whether such losses were covered by insurance, and if so, in what amount. All such records shall be public, except any testimony taken in an investigation under the provisions of this act which the state fire marshal in his discretion may withhold from the public.

(6) Establish by rule uniform training provisions for all persons acting as assistants to the state fire marshal as provided in section 41-256 , Idaho Code.

Legislative History: [(41-255) 39-3505 added 1970, ch. 190, sec. 5, p. 547; am. 1974, ch. 39, sec. 46, p. 1023; am. and redesig. 1982, ch. 120, sec. 3, p. 339; am. 2008, ch. 402, sec. 2, p. 1106.]

I.C. § 41-256: Assistants to state fire marshal — Local appeal procedure¶

(1) The chief of the fire department, or his deputy, of every city or county, or fire protection district organized under state law in which a fire department is established, and in areas where no organized fire department exists the county sheriff, or his deputy, shall be assistants to the state fire marshal in carrying out the provisions of the International Fire Code and rules of the state fire marshal.

(2) Any final decision made by an assistant to the state fire marshal involving an interpretation of the International Fire Code or rules of the state fire marshal shall contain a notification to any party subject to the decision that the decision may be appealed in a local appeal procedure that is substantially similar to the one set forth in the International Fire Code or rules adopted by the state fire marshal.

Legislative History: [(41-256) 39-3506 added 1970, ch. 190, sec. 6, p. 547; am. 1974, ch. 39, sec. 47, p. 1023; am. and redesig. 1982, ch. 120, sec. 4, p. 340; am. 1988, ch. 317, sec. 1, p. 976; am. 2002, ch. 86, sec. 7, p. 199; am. 2008, ch. 402, sec. 3, p. 1107.]

I.C. § 41-257: State fire marshal as chief arson investigation officer¶

The state fire marshal shall be the chief arson investigation officer in the state, and shall have the same responsibility and power in arson investigation as a county sheriff. He shall not, however, interfere at any time in the operation or administration of any fire department or sheriff’s office except in matters of fire prevention and arson investigation when requested by the local fire jurisdiction, sheriff’s office or written and signed complaint of any person served by the local fire jurisdiction. No person, acting without malice, shall be subject to civil liability for libel or otherwise, by virtue of the filing of complaints, requests, reports or furnishing other information pursuant to this section or required by the director of the department of insurance or the state fire marshal as a result of the authority herein granted.

Legislative History: [(41-257) 1970, ch. 190, sec. 7, p. 547; am. and redesig. 1982, ch. 120, sec. 5, p. 340.]

I.C. § 41-258: Report of losses by fire insurance companies to state fire marshal¶

Every fire insurance company authorized to transact business in this state is hereby required to report to the office of the state fire marshal, within seven (7) days after settlement of all fire losses of one thousand dollars ($1,000) or more, on property within the state of Idaho and all fire losses resulting in death or personal injury, including those personal injury losses covered by workmen’s compensation insurance. The report shall state the date of fire, the amount of probable property loss or personal injury, the character of property destroyed or damaged, and supposed cause of the fire. The report shall be in addition to and not in lieu of any report or reports such companies may be required by any law of this state to make to any other state officer.

Legislative History: [(41-258) 1970, ch. 190, sec. 8, p. 547; am. and redesig. 1982, ch. 120, sec. 6, p. 340.]

I.C. § 41-259: Inspection of buildings — Order of remedy or removal — Service of order¶

The state fire marshal, his deputies or assistants, upon the written and signed complaint of any person or whenever he or they shall deem it necessary, may at reasonable hours inspect buildings and premises within their jurisdiction, upon the presentation of proper credentials, except the interior of private dwellings, private garages appertaining to such residences, or buildings on farms of more than five (5) acres.

Whenever any of said officers shall find that any building or other structure which, for want of repairs, or lack of or insufficient fire escapes, automatic or other fire alarm apparatus or fire extinguishing equipment, or by reason of age or dilapidated condition, or due to violation of the International Fire Code or from any other cause, is especially liable to fire, and is so situated as to endanger life, other buildings or structures or said building or structure, he or they shall order the same to be remedied or removed, and such order shall forthwith be complied with by the owner or occupant of such premises or buildings, unless said owner or occupant avail himself of the appeals procedure set forth in this act.

The service of any such order shall be made upon the owner or occupant either by delivering to and leaving with the said person a true copy of the said order, or, by mailing such copy to the owner or occupant’s last known address. All mailings shall be registered or certified, with return receipt.

Legislative History: [(41-259) 1970, ch. 190, sec. 9, p. 547; am. and redesig. 1982, ch. 120, sec. 7, p. 341; am. 2008, ch. 402, sec. 4, p. 1107.]

I.C. § 41-260: Appeal from order of remedy or removal — Appeal from local appeal decision¶

If an order to remedy or remove, or a local appeal decision regarding the interpretation of the International Fire Code or rules of the state fire marshal, is made by the deputies or assistants of the state fire marshal, such owner or occupant who receives the order, or a party aggrieved by a local appeal decision, may, within twenty (20) days after receipt of service of such order or local appeal decision, appeal to the state fire marshal, who shall within ten (10) days, review such order or local appeal decision and if affirmed, file his decision thereon, and unless by his authority the order or local appeal decision is revoked or modified it shall remain in full force and be complied with within the time fixed in said order, local appeal decision, or decision of the state fire marshal.

Provided, however, that any such owner, occupant or party who feels himself aggrieved by any such order or local appeal decision, or affirming of such order or local appeal decision, may within thirty (30) days after the making or affirming of any such order or local appeal decision by the state fire marshal, appeal such order or local appeal decision to the district court having jurisdiction of the property.

Legislative History: [(41-260) 39-3510 added 1970, ch. 190, sec. 10, p. 547; am. and redesig. 1982, ch. 120, sec. 8, p. 341; am. 2008, ch. 402, sec. 5, p. 1107.]

I.C. § 41-261: Failure to comply with order of remedy or removal — Failure to comply with local decision or local appeal decision — Penalty — Civil action to recover penalty¶

Any owner or occupant failing to comply with such order or local decision, or local appeal decision within thirty (30) days after said appeal to the state fire marshal has been determined, or, if no appeal is taken, then within the time fixed in said order, local decision or local appeal decision shall be liable to a penalty of: ten dollars ($10.00) for each day’s neglect beginning with the first day through the seventh day; fifty dollars ($50.00) per day on the eighth through the thirtieth day; and one hundred dollars ($100) per day on the thirty-first day and each day thereafter. In the event such enforcement action is brought by the office of the state fire marshal, the penalty shall be payable to the state fire marshal, for deposit in the arson, fire and fraud prevention account. In the event such enforcement action is brought by a fire district under the authority of the state fire marshal, the penalty shall then be payable to the fire district which has prosecuted the enforcement action.

The penalty herein provided, if not then paid, may be recovered in an action brought in any court of competent jurisdiction of the county where such property is located, in the name of the state, under the direction of the state fire marshal and/or any of the assistants herein designated, where such property is located, or by an attorney specially designated therefor by the attorney general, or by the attorney for a fire district in the event such enforcement action is brought by the district. The reasonable attorney’s fees and costs incurred in bringing any such enforcement action, if any, shall be awarded to the state or the fire district bringing the enforcement action in addition to the assessment of any penalty, and shall be paid in the same manner as the penalty. If the court determines that the enforcement action has been brought frivolously or without reasonable cause, the court may award to the owner, occupant or party who is the subject of the enforcement action such reasonable attorney’s fees and costs of the defense or appeal of the enforcement action as the court determines is fair and just.

Legislative History: [(41-261) 39-3511 added 1970, ch. 190, sec. 11, p. 547; am. and redesig. 1982, ch. 120, sec. 9, p. 342; am. 2004, ch. 266, sec. 1, p. 748; am. 2008, ch. 402, sec. 6, p. 1108.]

I.C. § 41-262: Failure to comply with order of remedy or removal — Repair or demolition of premises — Expense¶

If any person fails to comply with the order of any officer, the state fire marshal or assistants to the state fire marshal under the preceding sections or with the order as modified on appeal as herein provided, and within the time fixed, then such officer, the state fire marshal or assistants to the state fire marshal are hereby empowered and authorized to cause such building or premises to be repaired, torn down or demolished, with the materials removed and all dangerous conditions remedied, at the expense of the person who fails to comply with such order.

Legislative History: [(41-262) 39-3512 added 1970, ch. 190, sec. 12, p. 547; am. and redesig. 1982, ch. 120, sec. 10, p. 342; am. 2008, ch. 402, sec. 7, p. 1109.]

I.C. § 41-263: Failure to pay expense of repair or demolition — Assessment¶

If, within thirty (30) days thereafter, such person shall fail, neglect or refuse to repay the expenses for demolishing or repair of said building incurred under the provisions of this act, to the state fire marshal’s office if the demolition or repair action was brought by the state fire marshal, or to a fire district if a fire district brought the demolition or repair action, the enforcing officer, state fire marshal or his assistants shall certify such expenses to the clerk of the city, fire district or county in which the property is situated, and the city, fire protection district or county shall certify to the county treasurer the amount of the assessment, which assessment shall be by said county treasurer, placed upon the tax roll and collected as other taxes, and when collected shall be refunded to the state fire marshal for deposit in the arson, fire and fraud prevention account if the demolition or repair action was brought by the state fire marshal, or to a fire district if a fire district brought the demolition or repair action.

Legislative History: [(41-263) 39-3513 added 1970, ch. 190, sec. 13, p. 547; am. 1974, ch. 39, sec. 48, p. 1023; am. and redesig. 1982, ch. 120, sec. 11, p. 342; am. 2008, ch. 402, sec. 8, p. 1109.]

I.C. § 41-264: Investigative hearings — Subpoena of witnesses — Conduct of hearing¶

The state fire marshal or his deputies shall have the power to request the district court to subpoena witnesses and compel them to attend before them, or either of them, and to testify in relation to any matter which by the provisions of this act is subject to inquiry and investigation, and may require the production of any book, paper or document deemed pertinent or necessary to the inquiry, and shall have the power to administer oaths and affirmations to any person appearing as a witness before them. Any such hearing shall be held in the county where the property is located.

Such examination may be public or private, as the officers conducting the investigation may determine, and persons other than those required to be present may be excluded from the place where such examination is held.

If, after such examination of witnesses or any investigation, the state fire marshal or any of his deputies or assistants is of the opinion that the facts in relation to such fire indicate that a crime has been committed, the state fire marshal or any of his deputies or assistants shall present the testimony taken on such examination, together with any other data in his possession, to the prosecuting attorney of the proper county, with the request that the prosecuting attorney institute such criminal proceedings as such testimony or data may warrant.

Legislative History: [(41-264) 1970, ch. 190, sec. 14, p. 547; am. 1970, ch. 249, sec. 1, p. 663; am. and redesig. 1982, ch. 120, sec. 12, p. 342.]

I.C. § 41-265: Witness fees — Charge for service of process¶

Each person summoned and testifying before the state fire marshal, his deputies or assistants, shall on the certification of the fire marshal and upon audit of the proper officer of the state, receive such sum or sums for witness fees and mileage as are provided for witnesses testifying in the district courts of this state; and officers serving subpoena and rendering other services to the state fire marshal shall be paid in like manner and amounts as they would be entitled for like service in such courts.

Legislative History: [(41-265) 1970, ch. 190, sec. 16, p. 547; am. and redesig. 1982, ch. 120, sec. 13, p. 343.]

I.C. § 41-266: Admission of international fire code in evidence¶

A copy of the international fire code, 2000 edition, or later editions and supplements adopted by the state of Idaho, shall be received in any court in this state as conclusive evidence of the contents of said code.

Legislative History: [(41-266) 1970, ch. 190, sec. 17, p. 547; am. and redesig. 1982, ch. 120, sec. 14, p. 343; am. 2002, ch. 86, sec. 8, p. 199.]

I.C. § 41-268: Arson, fire and fraud prevention account¶

(1) There is hereby created an account in the agency asset fund in the state treasury, to be designated the "arson, fire and fraud prevention account." The account shall be used by the director of the department of insurance for enforcement of this act, investigation of alleged cases of arson, fraud and related alleged violations of the laws of this state, and prevention of fire, explosions and other conditions necessary for the public safety, health, peace and welfare.

(2) In addition to moneys, if any, appropriated to the account by the legislature, the director shall deposit with the state treasurer for credit to the arson, fire and fraud prevention account:

(a) Penalties collected under the provisions of sections 41-261 and 41-263 , Idaho Code;

(b) That portion of the annual continuation fee as determined by the director pursuant to subsection (3) of this section;

(c) Other moneys now or hereinafter in the state fire prevention account;

(d) Other moneys or revenues derived from whatever source for arson or fraud investigation or fire prevention.

(3) A portion of the annual continuation fee, as determined by the director, will be used to fund the arson, fire and fraud account.

(4) All claims against the account shall be examined, audited and allowed in the manner now or hereafter provided by law.

(5) All moneys placed in the account are hereby perpetually appropriated to the department of insurance for the purposes of the provisions of this section.

(6) Pending use for purposes of the provisions of this section, moneys in the account shall be invested by the state treasurer in the same manner as provided under section 67-1210 , Idaho Code, with respect to other surplus or idle moneys in the state treasury. Interest earned on the investments shall be returned to the account.

Legislative History: [41-268, added 1982, ch. 120, sec. 17, p. 344; am. 1983, ch. 135, sec. 1, p. 331; am. 1999, ch. 65, sec. 1, p. 168; am. 2001, ch. 85, sec. 2, p. 212.]

I.C. § 41-269: Liberal construction of act¶

It is hereby declared that this act is necessary for the public safety, health, peace and welfare, is remedial and preventive in nature, and shall be construed liberally.

Legislative History: [(41-269) 1970, ch. 190, sec. 20, p. 547; am. and redesig. 1982, ch. 120, sec. 18, p. 345.]

I.C. § 41-286: Uniform claims processing¶

(1) Beginning July 1, 1995, all providers of health insurance coverage in Idaho shall use a uniform claim form/format and uniform billing and claim codes.

(2) The uniform claim form/format and billing codes shall be promulgated by the director as provided in chapter 52, title 67 , Idaho Code. The director, when developing the claim form/format and billing codes shall take into consideration forms/formats now in use and shall consult with appropriate federal, state and private organizations.

(3) Beginning July 1, 1996, all insurers shall offer compatible systems of electronic billing approved by the director in accordance with chapter 52, title 67 , Idaho Code. The system approved by the director may include monitoring and disseminating information concerning eligibility and coverage of individuals.

Legislative History: [41-286, added 1994, ch. 98, sec. 1, p. 223.]

I.C. § 41-287: Application of provisions adopted by national association of insurance commissioners¶

The department may not require an insurer to comply with any rule, regulation, directive or standard adopted by the national association of insurance commissioners unless application of the rule, regulation, directive or standard, including policy reserves, is authorized by statute and implemented by the director pursuant to chapter 52, title 67 , Idaho Code. This section shall not expand or restrict the general powers and authority of the director as set forth in section 41-210 , Idaho Code.

Legislative History: [(41-287) 41-286, added 1994, ch. 322, sec. 1, p. 1037; am. and redesig. 2005, ch. 25, sec. 95, p. 120.]

I.C. § 41-288: Retaliatory requirement¶

Should an insurance department, commissioner, director, or other similar insurance regulatory official of any other state or territory of the United States, impose any sanctions, fines, penalties, financial or deposit requirements, prohibitions, restrictions, regulatory requirements, or other obligations, of any kind, upon any insurance company organized or chartered in this state and licensed to transact business in such other state or territory, because of the failure of the Idaho department of insurance to obtain, maintain, or receive accreditation, certification, or any similar form of approval, compliance, or acceptance from, by, or as a member of the national association of insurance commissioners, or any committee, task force, working group, or advisory committee thereof, or because of the failure of the Idaho department of insurance to comply with any directive, financial or annual statement requirement, model act or regulation, market conduct or financial examination report or requirement, or any report of any kind of the national association of insurance commissioners, or any committee, task force, working group, or advisory committee thereof, the director shall, without exception or exclusion, impose upon any and all insurance companies organized or chartered in such other state or territory, and licensed to do business in this state, the same sanctions, fines, penalties, financial or deposit requirements, prohibitions, restrictions, regulatory requirements, or other obligations imposed by such state upon the insurance company domiciled in this state.

Legislative History: [41-288, added 1995, ch. 138, sec. 1, p. 592.]

I.C. § 41-290: Fraudulent claims¶

Any insurer which has facts to support a belief that a fraudulent claim is being or has been made shall, within sixty (60) days of the receipt of such notice, send to the director of insurance, on a form prescribed by the director, the information requested and such additional information relative to the claim and the parties claiming loss or damages as the director may require. The director of the department of insurance shall review such reports and select such claims as, in his judgment, may require further investigation. He shall then cause an independent examination of the facts surrounding such claim to be made to determine the extent, if any, to which fraud, deceit, or intentional misrepresentation of any kind exists in the submission of the claim. The director of the department of insurance shall report any alleged violations of law which his investigations disclose to the appropriate licensing agency and prosecuting authority having jurisdiction with respect to any such violation.

If, upon examination, the director of the department of insurance determines that an insurer has intentionally not reported a claim when the insurer had facts to support a belief that the claim was fraudulent in accordance with the provisions of this chapter, the director may impose fines and penalties pursuant to section 41-327 , Idaho Code, for each unreported suspected fraudulent claim.

Legislative History: [(41-290) I.C., sec. 41-250, as added by 1981, ch. 23, sec. 1, p. 39; am. and redesig. 1994, ch. 219, sec. 1, p. 696.]

I.C. § 41-291: Definitions¶

As used in sections 41-290 through and including 41-298 , Idaho Code:

(1) Sections 41-290 through 41-298 , Idaho Code, shall be known as the "Idaho Arson and Fraud Reporting-Immunity Act."

(2) "Authorized agencies" shall mean:

(a) Any law enforcement agency of this state;

(b) Any prosecuting attorney who may be responsible for prosecution in the jurisdiction where the fire or fraud occurred;

(c) The attorney responsible for the prosecution in the jurisdiction where the fire or fraud occurred as designated by the attorney general;

(d) The department of insurance, which includes the state fire marshal.

(3) Solely for the purpose of section 41-292 (1), Idaho Code, "authorized agencies" shall also include:

(a) The United States attorney’s office when authorized or charged with investigation or prosecution of the fire or fraud in question;

(b) The federal bureau of investigation or any other federal agency, charged with investigation or prosecution of the fire or fraud in question.

(4) "Relevant" means information having any tendency to make the existence of any fact that is of consequence to the investigation or determination of the issue more probable or less probable than it would be without the evidence.

(5) Material will be "deemed important," if within the sole discretion of the "authorized agency," such material is requested by the "authorized agency."

(6) "Action," as used in this chapter, shall include nonaction or the failure to take action.

(7) "Immunity" means that no civil action may arise against any person for furnishing information pursuant to section 41-248 , 41-258 , 41-290 , 41-292 , 41-296 or 41-297 , Idaho Code, where actual malice on the part of the insurance company, department of insurance, state fire marshal, authorized agency, their employees or agents, is not present.

(8) "Financial loss" includes, but is not limited to, loss of earnings, out-of-pocket and other expenses, repair and replacement costs and claims payments.

(9) "Person" means a natural person, company, corporation, unincorporated association, partnership, professional corporation and any other legal entity.

(10) "Practitioner" means a licensee of this state authorized to practice medicine and surgery, psychology, chiropractic, law or any other licensee of the state whose services are compensated, directly or indirectly, by insurance proceeds, or a licensee similarly licensed in other states and nations or the practitioner of any nonmedical treatment rendered in accordance with a recognized religious method of healing.

(11) "Statement" includes, but is not limited to, any of the following regardless of how it is made and in what format it is contained:

(a) Information submitted on an application for insurance;

(b) Description of policy terms, conditions, benefits or illustrations;

(c) Proof of insurance, certificate of insurance, or insurance card;

(d) Proof of claim, proof of loss, bill of lading, receipt for payment, invoice, account, estimate of property damages, bill for services, diagnosis, prescription, hospital or medical records, X-rays, test results or other evidence of loss, injury or expense; and

(e) Any other notice, correspondence, representation or information relating to an insurance coverage or claim.

(12) "Insurer" shall mean any insurance company contemplated by title 41 , Idaho Code, any business operating as a self-insured for any purpose, the state insurance fund, and any self-insured as contemplated by title 72 , Idaho Code.

(13) "Runner" means a person who procures, or persons working in conjunction with each other who procure, clients at the direction of, or in cooperation with, a person who, with the intent to deceive or defraud, performs or obtains a service or benefit under a contract of insurance or asserts a claim against an insured.

Legislative History: [(41-291) 41-270, added 1982, ch. 120, sec. 19, p. 345; am. and redesig. 1994, ch. 219, sec. 3, p. 697; am. 1997, ch. 122, sec. 1, p. 367; am. 1998, ch. 428, sec. 5, p. 1349; am. 2000, ch. 469, sec. 104, p. 1557; am. 2005, ch. 74, sec. 1, p. 251; am. 2007, ch. 239, sec. 1, p. 707.]

I.C. § 41-292: Disclosure of information by insurers¶

(1) The director of the department of insurance, state fire marshal or any authorized agency may, in writing, require the insurance company at interest to release to the requesting agency any or all relevant information or evidence deemed important to the authorized agency, director or state fire marshal which the company may have in its possession, relating to the loss in question. Relevant information may include, without limitation herein:

(a) Pertinent insurance policy information relevant to a loss under investigation and any application for such a policy;

(b) Policy premium payment records which are available;

(c) History of previous claims made by the insured;

(d) Material relating to the investigation of the loss, including statements of any person, proof of loss, and any other evidence relevant to the investigation.

(2) (a) When an insurance company has facts to support a belief that a loss in which it has an interest may be of other than accidental cause, then, for the purpose of notification and for having such loss investigated, the company shall, in writing, notify the director of the department of insurance, or the state fire marshal, and provide any or all material developed from the company’s inquiry into the loss.

(b) When an insurance company provides the director of the department of insurance or the state fire marshal with notice of a loss, it shall be sufficient notice for the purpose of this chapter.

(c) Nothing in section 41-292 (1), Idaho Code, shall abrogate or impair the rights or powers created under section 41-292 (2), Idaho Code.

(3) The director of the department of insurance, the state fire marshal or an authorized agency provided with information pursuant to section 41-248 , 41-258 , 41-290 or 41-292 (1) or (2), Idaho Code, and in furtherance of its own purposes, may release or provide such information to any of the other authorized agencies.

(4) Any insurance company providing information to an authorized agency or agencies pursuant to section 41-258 , 41-290 or 41-292 (1) or (2), Idaho Code, shall have the right to request relevant information relative to the loss in question and to receive, within a reasonable time, not to exceed thirty (30) days, the information requested, if the information is not otherwise privileged by law.

(5) In the absence of fraud or malice, no person shall be subject to civil liability for libel, slander or any other relevant tort cause of action by virtue of filing reports or furnishing other information required by this chapter or required by the director of the department of insurance under the authority granted in this chapter, and no civil cause of action of any nature shall arise against such person:

(a) For any information relating to suspected fraudulent insurance acts furnished to or received from authorized agencies, their agents and employees; or

(b) For any information relating to suspected fraudulent insurance acts furnished to or received from other persons subject to the provisions of this chapter; or

(c) For any such information furnished in reports to the department of insurance, national association of insurance commissioners, national insurance crime bureau or any organization established to detect and prevent fraudulent insurance acts, their agents, employees or designees, nor shall the director or any employee of the department of insurance, acting without malice in the absence of fraud, be subject to civil liability for libel, slander or any other relevant tort and no civil cause of action of any nature shall arise against such person by virtue of the publication of any report or bulletin related to the official activities of the department of insurance. Nothing herein is intended to abrogate or modify in any way any common law or statutory privilege or immunity heretofore enjoyed by any person.

(6) For purposes of subsection (5) of this section, there shall exist a rebuttable presumption that the person has acted without fraud or malice.

Legislative History: [(41-292) 1982, ch. 120, sec. 19, p. 346; am. and redesig. 1994, ch. 219, sec. 4, p. 698; am. 2005, ch. 74, sec. 2, p. 252.]

I.C. § 41-293: Insurance fraud¶

Insurance fraud includes:

(1) (a) Any person who, with the intent to defraud or deceive an insurer for the purpose of obtaining any money or benefit, presents or causes to be presented to any insurer, producer, practitioner or other person, any statement as part of, or in support of, a claim for payment or other benefit, knowing that such statement contains false, incomplete, or misleading information concerning any fact or thing material to such claim; or

(b) Any person who, with intent to defraud or deceive an insurer assists, abets, solicits, or conspires with another to prepare or make any statement that is intended to be presented to any insurer, producer, practitioner or other person, in connection with, or in support of, any claim for payment or other benefit, knowing that such statement contains false, incomplete, or misleading information concerning any fact or thing material to such claim;

(c) Any person who, with intent to defraud or deceive, presents or causes to be presented to or by an insurer, a producer, practitioner or other person, a false or altered statement material to an insurance transaction;

(d) Any insurance producer or other person who, with intent to defraud or deceive, willfully takes premium money knowing that insurance coverage will not be effected;

(e) Any practitioner or other person who willfully submits a false or altered statement, with the intent of deceiving an insurer or other person in connection with an insurance transaction or claim;

(f) Anyone willfully making a false statement or material misrepresentation to an insurer, employer, practitioner or other person, with the intent to defraud or deceive an insurer or other person, to obtain or extend worker’s compensation benefits;

(g) Anyone who offers or accepts a direct or indirect inducement to file or solicits another person to file a false statement, with intent to defraud or deceive an insurer;

(h) Any person who, with intent to defraud or deceive, transacts insurance of any kind or character, or transmits for a person other than himself an application for a policy of insurance, without proper licensing or after such license has been suspended or revoked;

(i) Any practitioner or any other person who, with intent to defraud or deceive, employs, uses or acts as a runner for the purpose of submitting a claim containing false, incomplete, or misleading information concerning any fact or thing material to such claim;

(j) Any employer or other person who, with intent to defraud or deceive, presents or causes to be presented to an insurer, producer or any other person or governmental agency any statement containing the number of employees, amount of payroll, job description or job title or any other statement material to worker’s compensation insurance which contains false, misleading or incomplete information; or

(k) Any person who, with intent to defraud or deceive, obstructs the director in the conduct of any authorized examination.

(2) A fact, statement or representation is "material" if it includes any of the following:

(a) Any fact which, if communicated to the producer, insurer, adjuster or representative thereof, would induce him to either decline insurance altogether or not accept it unless a higher premium is paid by the insured;

(b) Any fact relating to a claim for insurance benefits which, if disclosed, would be a fair reason for rejecting a claim for insurance benefits;

(c) Any fact, the knowledge or ignorance of which would naturally influence the insurer in making or refusing the contract, in estimating the degree or character of the risk, or in fixing the rate of premium;

(d) Any fact, the knowledge or ignorance of which would naturally influence the insurer in accepting or rejecting a claim for insurance benefits or compensation, or in determining the amount of compensation or insurance benefits to be paid to the insured; or

(e) Any fact that necessarily has some bearing on the subject matter of the insurance coverage or claim for benefits under an insurance contract.

(3) Any offense committed by use of a telephone, any means of electronic communication or mail as provided by this chapter may be deemed to have been committed at the place from which the telephone call or electronic communication was made, or mail was sent, or the offense may be deemed to have been committed at the place at which the telephone call, electronic communication or mail was received.

(4) Any violator of this section is guilty of a felony and shall be subject to a term of imprisonment not to exceed fifteen (15) years, or a fine not to exceed fifteen thousand dollars ($15,000), or both and shall be ordered to make restitution to the insurer or any other person for any financial loss sustained as a result of a violation of this section. Each instance of violation may be considered a separate offense.

Legislative History: [(41-293) 41-271, added 1981, ch. 23, sec. 3, p. 41; am. and redesig. 1994, ch. 219, sec. 5, p. 699; am. 1997, ch. 122, sec. 2, p. 368; am. 2007, ch. 239, sec. 2, p. 709.]

I.C. § 41-294: Damage to or destruction of insured property¶

Any person who wilfully burns or in any other manner injures or destroys any property which is at the time insured against loss or damage, with intent to defraud or prejudice the insurer or for personal gain, whether the same be the property of, or in possession of, such person or any other, is guilty of a felony punishable by imprisonment in the state prison not less than one (1) year nor more than fifteen (15) years, and shall be ordered to make restitution to the insurer or any other person for any financial loss sustained as a result of a violation of this section.

Legislative History: [(41-294) 1961, ch. 330, sec. 304, p. 645; am. and redesig. 1994, ch. 219, sec. 6, p. 700; am. 1997, ch. 122, sec. 3, p. 369.]

I.C. § 41-295: Duties of the investigation section¶

The investigation section of the department of insurance shall have the following duties:

(1) To conduct civil or criminal investigations within or outside this state as deemed necessary to determine whether any person has violated any provision of title 41 , Idaho Code.

(2) For purposes of any investigation under this code, the director, or any officer designated by him, may administer oaths and affirmations, subpoena bank records, subpoena witnesses and compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, agreements, or other documents the director deems relevant or material to the investigation.

(3) The investigation section shall furnish all papers, documents, reports, complaints, or other facts of evidence to any police, sheriff or other law enforcement agency, when so requested, and will assist and cooperate with such law enforcement agencies.

(4) The investigation section shall refer criminal violations of the code to the attorney general, county prosecutor, or other prosecutor having jurisdiction of any such violation. The attorney general, county prosecutor, or other prosecutor shall promptly institute and prosecute such action or proceedings against such person as the information may require or justify. Whoever is the prosecuting attorney of record shall have exclusive authority in all matters regarding such action or proceeding.

(5) The investigation section shall have such other duties as the director of the department of insurance shall assign or as contained elsewhere in title 41 , Idaho Code.

(6) The investigation section shall be permitted to seek court ordered restitution as reimbursement, for the cost of investigation from those individuals successfully prosecuted under section 41-293 , Idaho Code. Any restitution payments received pursuant to this section shall be deposited in the insurance administrative account as provided in section 41-401 , Idaho Code.

Legislative History: [41-295, added 1994, ch. 219, sec. 7, p. 700; am. 1997, ch. 122, sec. 4, p. 369; am. 2005, ch. 74, sec. 3, p. 253.]

I.C. § 41-296: Confidentiality — Compulsory testimony¶

(1) The department of insurance, state fire marshal or authorized agency described in section 41-291 , Idaho Code, which has received any information furnished pursuant to section 41-258 , 41-290 or 41-292 , Idaho Code, shall hold the information and the information shall be subject to disclosure according to chapter 1, title 74 , Idaho Code.

(2) Any authorized agency referred to in section 41-291 , Idaho Code, or their personnel, may be required to testify in any litigation in which the insurance company at interest is named as a party, if such testimony is not otherwise privileged by law.

Legislative History: [41-296, added 1982, ch. 120, sec. 19, p. 346; am. 1990, ch. 213, sec. 53, p. 523; am. and redesig. 1994, ch. 219, sec. 8, p. 701; am. 2015, ch. 141, sec. 107, p. 456.]

I.C. § 41-297: Disclosure requirements¶

(1) No person or agency shall intentionally or knowingly refuse to release any information requested pursuant to section 41-292 (1) or (3), Idaho Code.

(2) No person shall intentionally or knowingly refuse to provide authorized agencies relevant information pursuant to section 41-292 (2), Idaho Code.

(3) No person shall fail to hold in confidence information required to be held in confidence by section 41-296 , Idaho Code.

(4) Whoever violates subsection (1), (2) or (3) of this section, is guilty of a misdemeanor, and upon conviction, shall be punished by a fine not to exceed one thousand dollars ($1,000). In addition to any criminal penalty, if the person is an insurance company or other person licensed by or regulated by the director of insurance, the director may, after hearing thereon, impose an administrative penalty on the violator not to exceed five thousand dollars ($5,000).

Legislative History: [(41-297) 1982, ch. 120, sec. 19, p. 347; am. and redesig. 1994, ch. 219, sec. 9, p. 702.]

I.C. § 41-298: Jurisdiction — Construction of provisions¶

(1) The provisions of this chapter shall not be construed to affect or repeal any ordinance of any municipality relating to fire prevention or the control of arson or fraud, but the jurisdiction of the state fire marshal, the director, department of insurance, and the director, Idaho state police, in such municipality is to be concurrent with that of the municipal and county authorities.

(2) With the exception of section 41-291 (7), Idaho Code, all other provisions of this chapter shall not be construed to impair any existing statutory or common law rights or powers.

Legislative History: [(41-298) 1982, ch. 120, sec. 19, p. 347; am. and redesig. 1994, ch. 219, sec. 10, p. 702; am. 2000, ch. 469, sec. 105, p. 1558.]

Chapter 10¶

I.C. § 41-1001: Purpose and scope¶

(1) This chapter governs the qualifications and procedures for the licensing of insurance producers. It simplifies and organizes statutory language to improve efficiency, permits the use of new technology and reduces costs associated with issuing and renewing insurance licenses.

(2) This chapter applies to adjusters to the extent provided in section 41-1108 , Idaho Code, and to surplus lines brokers to the extent provided in sections 41-1223 and 41-1224 , Idaho Code. Except where expressly made applicable, this chapter does not apply to title insurance under chapter 27, title 41 , Idaho Code.

Legislative History: [41-1001, added 2001, ch. 296, sec. 3, p. 1047.]

I.C. § 41-1002: Terms construed¶

Wherever the terms "agent" or "broker" appear in title 41 , Idaho Code, or in the rules of the department, they shall be understood and construed to mean "producer" as defined in section 41-1003 (8), Idaho Code, except as used in section 41-1018 , Idaho Code, and any other sections where it is apparent from the language that the terms should not be so construed.

Legislative History: [41-1002, added 2001, ch. 296, sec. 3, p. 1047; am. 2002, ch. 281, sec. 1, p. 823.]

I.C. § 41-1003: Definitions¶

(1) "Business entity" means a corporation, association, partnership, limited liability company, limited liability partnership or other legal entity.

(2) "Home state" means the District of Columbia and any state or territory of the United States or any province of Canada in which an insurance producer maintains his or her principal place of residence or principal place of business and is licensed to act as an insurance producer.

(3) "License" means a document issued by the director authorizing a person to act as an insurance producer for the lines of authority specified in the document. The license itself does not create any authority, actual, apparent or inherent, in the holder to represent or commit an insurance carrier.

(4) "Limited lines insurance" is insurance which restricts the authority of the license to less than the total authority prescribed in the associated major lines pursuant to section 41-1008 (1)(a) through (g), Idaho Code, and shall include, but not be limited to: credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection (GAP) insurance, transportation baggage insurance, transportation ticket policies covering personal accident insurance, pet insurance, portable electronics insurance, travel insurance or any other line of insurance that the director deems necessary to recognize for the purposes of complying with section 41-1009 (5), Idaho Code.

(5) "Limited lines producer" means a producer authorized by the director to sell, solicit or negotiate limited lines insurance. "Limited lines producer" includes a "limited lines travel insurance producer" as used in sections 41-1090 through 41-1096 , Idaho Code.

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

(7) "Person" means an individual or a business entity.

(8) "Producer" means a person required to be licensed under the laws of this state to sell, solicit or negotiate insurance.

(9) "Resident" means a person whose home state is Idaho or any other particular state identified in conjunction with the use of the term.

(10) "Sell" means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurance company.

(11) "Solicit" means attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company or companies.

(12) "Terminate" means the cancellation of the relationship between an insurance producer and the insurer or the termination of a producer’s authority to transact insurance for or on behalf of an insurer.

(13) "Uniform application" means the current version of the national association of insurance commissioners (NAIC) uniform application for resident and nonresident producer licensing.

(14) "Uniform business entity application" means the current version of the NAIC uniform business entity application for resident and nonresident business entities.

Legislative History: [41-1003, added 2001, ch. 296, sec. 3, p. 1047; am. 2012, ch. 226, sec. 1, p. 619; am. 2017, ch. 198, sec. 1, p. 494.]

I.C. § 41-1004: License required¶

(1) A person shall not sell, solicit or negotiate insurance in this state for any class or classes of insurance unless the person is licensed as a producer for that line of authority in accordance with this chapter.

(2) A person shall not, for a fee, engage in the business of offering any advice, counsel, opinion or service with respect to the benefits, advantages or disadvantages under any policy of insurance that could be issued in Idaho unless that person is:

(a) A licensed insurance producer offering advice concerning a class of insurance as to which the producer is licensed to transact business in this state;

(b) An attorney rendering services in the performance of the duties of an attorney;

(c) A certified public accountant rendering services in the performance of the duties of a certified public accountant, as authorized by law;

(d) An actuary rendering actuarial services if such actuary is a member of an organization determined by the director as establishing standards for the actuarial profession;

(e) A person providing services to producers or authorized insurers only;

(f) A person rendering services as an expert pursuant to the Idaho rules of evidence;

(g) An investment adviser, investment adviser representative or federally covered investment adviser as defined in section 30-14-102 , Idaho Code; or

(h) A person rendering such services pursuant to a license issued in accordance with sections 41-1081 through 41-1089 of this chapter.

Legislative History: [41-1004, added 2001, ch. 296, sec. 3, p. 1048; am. 2002, ch. 282, sec. 1, p. 825; am. 2004, ch. 45, sec. 6, p. 227; am. 2012, ch. 226, sec. 2, p. 620.]

I.C. § 41-1005: Exceptions to licensing¶

(1) Nothing in this chapter shall be construed to require an insurer to obtain an insurance producer license. In this section, the term "insurer" does not include an insurer’s officers, directors, employees, subsidiaries or affiliates.

(2) A license as an insurance producer shall not be required of the following:

(a) An officer, director or employee of an insurer or of an insurance producer, provided that the officer, director or employee does not receive any commission on policies written or sold to insure risks residing, located or to be performed in this state and:

(i) The activities of the officer, director or employee are executive, administrative, managerial, clerical or a combination of these, and are only indirectly related to the sale, solicitation or negotiation of insurance; or

(ii) The function of the officer, director or employee relates to underwriting, loss control, inspection or the processing, adjusting, investigating or settling of a claim on a contract of insurance; or

(iii) The officer, director or employee is acting in the capacity of a special agent or agency supervisor assisting insurance producers where the person’s activities are limited to providing technical advice and assistance to licensed insurance producers and do not include the sale, solicitation or negotiation of insurance;

(b) A person who secures and furnishes information for the purpose of group life insurance, group property and casualty insurance, group annuities, group or blanket accident and health insurance, or for the purpose of enrolling individuals under plans, issuing certificates under plans or otherwise assisting in administering plans, or performs administrative services relating to mass-marketed property and casualty insurance, and who does not receive a commission;

(c) An employer or association or its officers, directors, employees or the trustees of an employee trust plan, to the extent that the employer, association, officer, employee, director or trustee is engaged in the administration or operation of a program of employee benefits for the employer’s or association’s own employees or the employees of its subsidiaries or affiliates, which involves the use of insurance issued by an insurer, as long as the employer, association, officer, director, employee or trustee is not in any manner compensated, directly or indirectly, by the company issuing the contracts;

(d) Employees of insurers or organizations employed by insurers who are engaging in the inspection, rating or classification of risks, or in the supervision of the training of insurance producers, and who are not individually engaged in the sale, solicitation or negotiation of insurance, and who do not receive a commission;

(e) A person whose activities in this state are limited to advertising without the intent to solicit insurance in this state through communications in printed publications or other forms of electronic mass media whose distribution is not limited to residents of the state, provided that the person does not sell, solicit or negotiate insurance that would insure risks residing, located or to be performed in this state;

(f) A person who is not a resident of this state who sells, solicits or negotiates a contract of insurance for commercial property and casualty risks to an insured with risks located in more than one (1) state insured under that contract, provided that the person is otherwise licensed as an insurance producer to sell, solicit or negotiate that insurance in the state where the insured maintains its principal place of business and the contract of insurance insures risks located in that state;

(g) A salaried full-time employee who counsels or advises his or her employer relative to the insurance interests of the employer or of the subsidiaries or business affiliates of the employer, provided that the employee does not sell or solicit insurance or receive a commission; or

(h) A person who, concurrent with the rental of a motor vehicle, provides contract options to the standard rental agreement which provides auto and travel related coverages through authorized insurers during a rental period not to exceed ninety (90) days.

Legislative History: [41-1005, added 2001, ch. 296, sec. 3, p. 1048.]

I.C. § 41-1006: Application for examination¶

(1) A resident individual applying for an insurance producer license shall pass a written examination unless exempt pursuant to section 41-1008 (4) or 41-1012 , Idaho Code. The examination shall test the knowledge of the individual concerning the lines of authority for which application is made, the duties and responsibilities of an insurance producer and the insurance laws and rules of this state. Examinations required by this section shall be developed and conducted under rules prescribed by the director of the department of insurance.

(2) Each individual applying for an examination shall remit a nonrefundable fee as promulgated by the director pursuant to section 41-401 , Idaho Code.

(3) An individual who fails to appear for the examination as scheduled or who fails to pass the examination shall reapply for an examination and remit all required fees and forms before being rescheduled for another examination.

(4) Applications for licensure not received by the department within one hundred eighty (180) days of the successful completion of the examination shall be denied.

Legislative History: [41-1006, added 2001, ch. 296, sec. 3, p. 1050; am. 2002, ch. 281, sec. 2, p. 823.]

I.C. § 41-1007: Application for producer license¶

(1) A person applying for a resident insurance producer license shall make application to the director on the uniform application and declare under penalty of refusal, suspension or revocation of the license that the statements made in the application are true, correct and complete to the best of the applicant’s knowledge and belief. Before approving the application, the director shall find that the applicant:

(a) Is at least eighteen (18) years of age;

(b) Has submitted the applicant’s fingerprints as may be required by the director;

(c) Has not committed any act that is a ground for denial, suspension or revocation of the license as set forth in title 41 , Idaho Code;

(d) Has paid the fees prescribed by the director pursuant to section 41-401 , Idaho Code; and

(e) Has successfully passed the examinations for the lines of authority for which the applicant has applied.

(2) A business entity acting as an insurance producer is required to obtain an insurance producer license. Application shall be made using the uniform business entity application. Before approving the application, the director shall find that:

(a) The business entity has paid the fees prescribed by the director pursuant to section 41-401 , Idaho Code; and

(b) The business entity has designated a licensed producer, who is an individual responsible for the business entity’s compliance with the insurance laws and rules of this state.

(3) The director may require any documents which are reasonably necessary to verify the information contained in an application.

(4) Each insurer that sells, solicits or negotiates any form of limited line insurance shall provide to each individual whose duties will include selling, soliciting or negotiating limited lines insurance a program of instruction that may be required to be approved by the director. If acceptable to the director, and as stated by rule, the program of instruction may be administered in place of the examination as required in section 41-1006 , Idaho Code. In addition, such course of instruction may be administered in place of any continuing education requirements pursuant to section 41-1013 , Idaho Code.

Legislative History: [41-1007, added 2001, ch. 296, sec. 3, p. 1050.]

I.C. § 41-1008: Producer License¶

(1) Unless denied licensure pursuant to section 41-1016 , Idaho Code, persons who have met the requirements of sections 41-1006 and 41-1007 , Idaho Code, shall be issued an insurance producer license. An insurance producer may receive qualification for a license in one (1) or more of the following lines of authority:

(a) Life insurance coverage on human lives, including benefits of endowment and annuities, benefits in the event of death or dismemberment by accident, and benefits for disability income;

(b) Disability, including accident and health or sickness insurance coverage for sickness, bodily injury or accidental death and benefits for disability income;

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

(d) Casualty insurance coverage against legal liability, including liability for death, injury or disability or damage to real or personal property;

(e) Variable life and variable annuity products, meaning insurance coverage provided under variable life insurance contracts and variable annuities;

(f) Personal lines, meaning property and casualty insurance coverage sold to individuals and families for primarily noncommercial purposes;

(g) Any other line of insurance permitted under state laws or rules.

(2) An insurance producer license shall remain in effect unless revoked or suspended as long as the renewal fee promulgated by the director pursuant to section 41-401 , Idaho Code, is paid and the continuing education requirements for resident insurance producers are met in accordance with section 41-1013 , Idaho Code.

(3) An individual insurance producer who allows his or her license to lapse may, within twelve (12) months from the due date of the renewal fee, reinstate the same license without passing a written examination unless the licensee would otherwise be required to retest under section 41-1013 (7), Idaho Code. However, a penalty in the amount of double the unpaid renewal fee shall be required for any renewal fee received after the due date.

(4) A licensed insurance producer who is unable to comply with license renewal procedures due to military service or some other extenuating circumstance, such as a long-term medical disability, may request that the director waive those procedures. The producer may also request a waiver of any examination requirement or any other fine or sanction imposed for failure to comply with renewal procedures.

(5) The license shall contain the licensee’s name, address, personal identification number, the date of issuance, the lines of authority, the expiration date and any other information the director deems necessary.

(6) Licensees shall inform the director by any means acceptable to the director of a change of address within thirty (30) days of the change. A business entity licensed as a producer shall inform the director by any means acceptable to the director of any change in ownership, officers, directors or the designated licensed producer responsible for compliance pursuant to section 41-1007 (2)(b), Idaho Code.

(7) In order to assist in the performance of the director’s duties, the director may contract with nongovernmental entities, including the national association of insurance commissioners or its affiliates or subsidiaries, to perform any ministerial functions related to producer licensing, including the collection of fees, that the director and the nongovernmental entity may deem appropriate.

Legislative History: [41-1008, added 2001, ch. 296, sec. 3, p. 1051.]

I.C. § 41-1009: Nonresident producer license¶

(1) Unless denied licensure pursuant to section 41-1016 , Idaho Code, a nonresident applicant shall receive a nonresident producer license if:

(a) The applicant is currently licensed as a resident and in good standing in his or her home state;

(b) The applicant has submitted the proper request for licensure and has paid the fees set forth by rule pursuant to section 41-401 , Idaho Code;

(c) The applicant has submitted or transmitted to the director the application for licensure that the applicant submitted to his or her home state or, in lieu of such application, a completed uniform application;

(d) The applicant has submitted the applicant’s fingerprints, if required by the director, on a form as prescribed by the director; and

(e) The applicant’s home state awards nonresident producer licenses to residents of this state on the same basis.

(2) The director may verify the producer’s licensing status through the producer database maintained by the national association of insurance commissioners, its affiliates or subsidiaries, or by any other acceptable means.

(3) A nonresident producer who moves from one state to another state or a resident producer who moves from this state to another state shall file a change of address and provide certification from the new resident state within thirty (30) days of the change of legal residence. No fee or license application shall be required for filing the change of address.

(4) Notwithstanding any other provision of this chapter, a person licensed as a surplus lines broker in his or her home state shall receive a nonresident surplus lines broker license pursuant to subsection (1) of this section. Except as to subsection (1) of this section, nothing in this section otherwise amends or supersedes any provision of section 41-1223 , Idaho Code.

(5) Notwithstanding any other provision of this chapter, a person licensed as a limited lines producer in his or her home state shall receive a nonresident limited lines producer license, pursuant to subsection (1) of this section, granting the same scope of authority as granted under the license issued by the producer’s home state. For the purposes of this subsection, limited lines insurance is any authority granted by the home state which restricts the authority of the license to less than the total authority prescribed in the associated major lines pursuant to section 41-1008 (1)(a) through (g), Idaho Code.

Legislative History: [41-1009, added 2001, ch. 296, sec. 3, p. 1052.]

I.C. § 41-1010: Nonresident producers — Service of process¶

(1) Each person applying to be a nonresident producer shall, on a form prescribed by the director, appoint the director as his agent for purposes of receiving service of legal process issued against the producer in this state upon causes of action arising within this state out of transactions under the license. Service upon the director as an agent shall constitute effective legal service upon the producer.

(2) The appointment shall be irrevocable for as long as there could be any cause of action against the licensee arising out of his insurance transactions in or with respect to this state.

(3) Duplicate copies of such legal process against the licensee shall be served upon the director by a person competent to serve a summons. At the time of service the plaintiff shall pay the director an appropriate fee to be determined by rule and not exceeding thirty dollars ($30.00).

(4) Upon receiving such service, the director shall send one (1) copy of the process by registered or certified mail with return receipt requested to the defendant licensee at his last address of record with the director.

(5) The director shall keep a record of the day and hour of such service upon him. No proceedings shall be brought against the producer, and the producer shall not be required to appear, plead or answer until the expiration of thirty (30) days after the date of service upon the director.

Legislative History: [41-1010, added 2001, ch. 296, sec. 3, p. 1053.]

I.C. § 41-1011: Issuance — Refusal of license¶

If after completion of application for a license, the taking and passing of any examination required under this chapter and, if required by the director, receipt of a report from the federal bureau of investigation based on the fingerprints of the applicant, the director finds that the applicant has fully met the requirements for a license, the director shall issue the license to the applicant; otherwise, the director shall refuse to issue the license and shall promptly notify the applicant and any appointing insurer or insurers of such refusal and state the grounds for the refusal. Pending the receipt of the report from the federal bureau of investigation, the director may, in his discretion, issue a temporary license if all other qualifications have been met.

Legislative History: [41-1011, added 2001, ch. 296, sec. 3, p. 1053.]

I.C. § 41-1012: Exemption from examination¶

(1) An individual who applies for an insurance producer license in this state and who was previously licensed for the same lines of authority in another state shall not be required to complete any prelicensing examination if:

(a) The person is currently licensed in another state; or

(b) The application is received within ninety (90) days of the cancellation of the applicant’s previous license and the prior state issues a certification that:

(i) At the time of cancellation, the applicant was in good standing in that state; or

(ii) The state’s producer database records, as maintained by the national association of insurance commissioners or its affiliates or subsidiaries, indicate that the producer is or was licensed in good standing for the lines of authority requested.

(2) A person licensed as an insurance producer in another state who moves to this state shall make application within ninety (90) days of establishing legal residence to become a resident licensee pursuant to section 41-1006 , Idaho Code. No examination shall be required of that person to obtain any line of authority previously held in the prior state unless the director provides otherwise by rule.

Legislative History: [41-1012, added 2001, ch. 296, sec. 3, p. 1053.]

I.C. § 41-1013: Continuation — Expiration of licenses — Continuing education statement¶

(1) All producer, adjuster, and surplus line broker licenses issued under this code shall continue in force until expired, suspended, revoked or otherwise terminated, subject to payment of the applicable continuation fee on or before the expiration date referred to in subsection (2) of this section, accompanied by a written request for such continuation and a continuing education statement verifying that the licensee has completed any continuing education requirements imposed by the director. An application for renewal is not complete unless it is submitted with both the applicable fee and the completed continuing education statement. Requests for continuation shall be made in writing on forms to be prescribed by the director.

(2) The director may fix the dates of expiration for licenses in such manner as is deemed by him to be advisable for an efficient distribution of the workload of his office. If the expiration date for a particular license or appointment would shorten the period for which the license or appointment continuation fee has been paid, no refund of an unearned fee shall be made. If the expiration date for a particular license or appointment would lengthen the period for which a license or appointment continuation fee has been paid, the director shall charge no additional fee for such lengthened period.

(3) Any license referred to in subsection (1) of this section for which no request for continuation, fee and completed continuing education statement are timely received by the director shall be deemed to have expired at midnight on the applicable expiration date.

(4) All sums tendered as fees for continuations of licenses as producer, limited lines producer, adjuster or surplus line broker shall be deemed earned when paid and shall not be subject to refund, except that the director shall refund any duplicate payment of fees.

(5) For the protection of the people of this state the director shall establish, by rule, additional educational requirements designed to maintain and improve the insurance skills and knowledge of resident producers after licensure by the department of insurance. The director shall also establish, by rule, an advisory committee comprised of representatives from each segment of the insurance industry to assist the director in prescribing additional educational requirements. Such rules promulgated by the director shall include limits on the terms of service for members of the committee.

(6) Subject to subsection (3) of this section, the director shall not permit to be continued the license of any producer who is licensed pursuant to section 41-1007 , Idaho Code, who is a resident of this state, unless such person has demonstrated to the satisfaction of the director that in addition to meeting the standards contained in sections 41-1007 , (qualifications for producer license), Idaho Code, as may be applicable, all the additional educational requirements as the director may prescribe by rule have been met.

(7) Failure of the licensee to comply with any applicable additional education requirements prescribed by the director by rule by the expiration date of the license shall be grounds for the director to refuse to continue any such license. The licensee may reinstate his or her license by submitting proof of all education requirements within ninety (90) days from the date of expiration of the license and by submitting an additional administrative penalty of one hundred dollars (sections 41-1007, (qualifications for producer license), Idaho Code, as may be applicable, all the additional educational requirements as the director may prescribe by rule have been met.

(7) Failure of the licensee to comply with any applicable additional education requirements prescribed by the director by rule by the expiration date of the license shall be grounds for the director to refuse to continue any such license. The licensee may reinstate his or her license by submitting proof of all education requirements within ninety (90) days from the date of expiration of the license and by submitting an additional administrative penalty of one hundred dollars ($100) for a delinquency of one (1) day to thirty (30) days, two hundred dollars ($200) for a delinquency of00) for a delinquency of one (1) day to thirty (30) days, two hundred dollars (00) for a delinquency of thirty-one (31) days to sixty (60) days, and three hundred dollars ($300) for a delinquency of sixty-one (61) days to ninety (90) days. Following the ninetieth day from the date of nonrenewal of the license and up to one (1) year from the nonrenewal date, the licensee must complete all requirements for licensure including retesting, submission of a new application and payment of all new licensing fees. In addition, the individual must submit proof of completion of the required education requirements for the licensing period in which the license was terminated. After the license has been expired for one (1) year or more, the individual must reapply and retest as a new applicant.

Legislative History: [41-1013, added 2001, ch. 296, sec. 3, p. 1054.]

I.C. § 41-1014: Assumed names¶

An insurance producer doing business under any name other than the producer’s legal name is required to notify the director in writing prior to using the assumed name.

Legislative History: [41-1014, added 2001, ch. 296, sec. 3, p. 1055.]

I.C. § 41-1015: Temporary licensing¶

(1) The director may issue a temporary insurance producer license for a period not to exceed one hundred eighty (180) days without requiring an examination if the director deems that the temporary license is necessary for the servicing of an insurance business in the following cases:

(a) To the surviving spouse or court-appointed personal representative of a licensed insurance producer who dies or becomes mentally or physically disabled in order to allow adequate time for the sale of the insurance business owned by the producer or for the recovery or return of the producer to the business or to provide for the training and licensing of new personnel to operate the producer’s business;

(b) To a member or employee of a business entity licensed as an insurance producer upon the death or disability of an individual designated in the business entity application or the license;

(c) To the designee of a licensed insurance producer entering active service in the armed forces of the United States of America; or

(d) Pursuant to section 41-1011 , Idaho Code, or in any other circumstance where the director deems the public interest will best be served by the issuance of the temporary license.

(2) The director may by order limit the authority of any temporary licensee in any way deemed necessary to protect insureds and the public. The director may require the temporary licensee to have a suitable sponsor who is a licensed producer or insurer and who assumes responsibility for all actions of the temporary licensee, and may impose other similar requirements designed to protect insureds and the public. The director may by order revoke a temporary license, without the right to a prior hearing, if the interests of insureds or the public are endangered. A temporary license may not continue after the owner or the personal representative disposes of the business.

Legislative History: [41-1015, added 2001, ch. 296, sec. 3, p. 1055.]

I.C. § 41-1016: Administrative penalty — Suspension, revocation, refusal of license¶

(1) The director may impose an administrative penalty not to exceed one thousand dollars ($1,000), for deposit in the general fund of the state of Idaho, and may suspend for not more than twelve (12) months or may revoke or refuse to issue or continue any license issued under this chapter, chapter 27, title 41 , Idaho Code (title insurance), chapter 11, title 41 , Idaho Code (adjusters), or chapter 12, title 41 , Idaho Code (surplus lines brokers), if the director finds that as to the licensee or applicant any one (1) or more of the following causes or violations exist:

(a) Providing incorrect, misleading, incomplete or materially untrue information in the license application;

(b) Violating any provision of title 41 , Idaho Code, department rule, subpoena or order of the director or of another state’s insurance director;

(c) Obtaining or attempting to obtain a license through misrepresentation or fraud;

(d) Improperly withholding, misappropriating or converting any moneys or properties received in the course of doing insurance business;

(e) Misrepresenting the terms of an actual or proposed insurance contract or application for insurance or misrepresenting any fact material to any insurance transaction or proposed transaction;

(f) Being convicted of or pleading guilty to a crime that is deemed relevant in accordance with section 67-9411 (1), Idaho Code, or that evidences dishonesty, a lack of integrity and financial responsibility, or an unfitness and inability to provide acceptable service to the consuming public;

(g) Admitting or being found to have committed any insurance unfair trade practice or fraud;

(h) Using fraudulent, coercive or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility, or being a source of injury and loss to the public or others, in the conduct of business in this state or elsewhere;

(i) Having an insurance license denied, suspended or revoked in any other state, province, district or territory;

(j) Forging another’s name on an application for insurance or on any document related to an insurance transaction;

(k) Improperly using notes or any other reference material to complete an examination for an insurance license;

(l) Knowingly accepting insurance business from an individual who is not licensed;

(m) Failing to comply with an administrative or court order imposing a child support obligation, provided however, that nothing in this provision shall be deemed to abrogate or modify chapter 14, title 7 , Idaho Code;

(n) Failing to pay state income tax or to comply with any administrative or court order directing payment of state income tax; or

(o) In the case of a bail agent, compensating or agreeing to compensate any incarcerated person to influence or encourage another incarcerated person or other incarcerated persons to engage the bail agent’s services or the services of the bail agent’s company or of other bail agents employed by such bail company. For purposes of this subsection, compensating any incarcerated person shall include providing payment in any form to any person, organization or entity designated by the incarcerated person to receive such payment.

(2) The director shall, without hearing, suspend for not more than twelve (12) months, or shall revoke or refuse to continue any license issued under this chapter to a nonresident where:

(a) The director has received a final order of suspension, revocation or refusal to continue from the insurance regulatory official or court of jurisdiction of the licensee’s home state; or

(b) A nonresident no longer has a license in the licensee’s home state because the home state license was:

(i) Voluntarily surrendered for any reason except relicensing as a resident in another state; or

(ii) Otherwise nonrenewed by the nonresident and remains nonrenewed for a period greater than ninety (90) days beyond its expiration date, and without notice to the director of relicensing as a resident in another state.

If cause under this provision exists after the expiration of the twelve (12) months, successive suspensions may be imposed by the director without hearing.

(3) The license of a business entity may be suspended, revoked or refused if the director finds that the violation of an individual licensee, who is registered to or acting on behalf of the business entity, was known or should have been known by one (1) or more of the owners, officers or managers acting on behalf of the business entity and that the violation was not reported to the director and no corrective action was taken.

(4) In addition to or in lieu of any applicable denial, suspension or revocation of a license, a person may, after hearing, be subject to a civil fine or administrative penalty pursuant to subsection (1) of this section or any other applicable section.

(5) The director shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by title 41 , Idaho Code, against any person who is under investigation for or charged with a violation of title 41 , Idaho Code, or department rule, even if the person’s license or registration has been surrendered or has lapsed by operation of law, or if the person has never been licensed.

Legislative History: [41-1016, added 2001, ch. 296, sec. 3, p. 1056; am. 2005, ch. 77, sec. 5, p. 259; am. 2006, ch. 49, sec. 3, p. 142; am. 2016, ch. 50, sec. 1, p. 144; am. 2017, ch. 258, sec. 1, p. 634; am. 2020, ch. 175, sec. 8, p. 511.]

I.C. § 41-1017: Commissions¶

(1) An insurance company or insurance producer shall not pay a commission, service fee or other valuable consideration to a person for selling, soliciting or negotiating insurance in this state if that person is not duly licensed as required under this chapter.

(2) A person shall not accept a commission, service fee or other valuable consideration for selling, soliciting or negotiating insurance in this state if that person is not duly licensed as required under this chapter.

(3) Renewals or other deferred commissions may be paid to a person for selling, soliciting or negotiating insurance in this state if that person was duly licensed as required under this chapter at the time of the sale, solicitation or negotiation.

(4) An insurer or insurance producer may pay or assign commissions, service fees or other valuable consideration to any person, regardless of whether that person is licensed as a producer, unless the payment or assignment would violate a specific section of title 41 , Idaho Code, including, but not limited to, sections 41-1314 and 41-2708 , Idaho Code, or department rule.

Legislative History: [41-1017, added 2001, ch. 296, sec. 3, p. 1057.]

I.C. § 41-1018: Appointments¶

(1) An insurance producer shall not act as an agent of an insurer unless the insurance producer becomes an appointed agent of that insurer. An insurance producer who is not acting as an agent of an insurer is not required to become appointed.

(2) To appoint a producer as its agent, the appointing insurer shall file, in a format approved by the director, a notice of appointment within fifteen (15) days from the date the agency contract is executed or the first insurance application is submitted.

(3) Upon receipt of the notice of appointment, the director shall verify, within a reasonable time not to exceed thirty (30) days, that the insurance producer is eligible for appointment. If the insurance producer is determined to be ineligible for appointment, the director shall notify the insurer within five (5) days of his determination.

Legislative History: [41-1018, added 2001, ch. 296, sec. 3, p. 1058.]

I.C. § 41-1019: Notification to director of termination¶

(1) An insurer or authorized representative of the insurer that terminates the appointment, employment, contract or other insurance business relationship with a producer shall notify the director within thirty (30) days following the effective date of the termination, using a format prescribed by the director, if the reason for termination is one of the reasons set forth in section 41-1016 , Idaho Code, or the insurer has knowledge that the producer was found by a court, governmental body or self-regulatory organization authorized by law to have engaged in any of the activities set forth in section 41-1016 , Idaho Code. Upon the written request of the director, the insurer shall provide additional information, documents, records or other data pertaining to the termination or activity of the producer.

(2) An insurer or authorized representative of the insurer that terminates the appointment, employment, contract or other insurance business relationship with a producer for any reason not set forth in section 41-1016 , Idaho Code, shall notify the director within thirty (30) days following the effective date of the termination, using a format prescribed by the director. Upon written request of the director, the insurer shall provide additional information, documents, records or other data pertaining to the termination.

(3) The insurer or authorized representative of the insurer shall promptly notify the director in a format acceptable to the director if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the director in accordance with subsection (1) of this section.

(4) A copy of any notification shall be provided to the producer as follows:

(a) Within fifteen (15) days after making the notification required by subsections (1), (2) and (3) of this section, the insurer shall mail a copy of the notification to the producer at his or her last known address. If the producer is terminated for cause for any other reasons listed in section 41-1016 , Idaho Code, the insurer shall provide a copy of the notification to the producer at his or her last known address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier.

(b) Within thirty (30) days after the producer has received the original or additional notification, the producer may file written comments concerning the substance of the notification with the director. The producer shall, by the same means, simultaneously send a copy of the comments to the reporting insurer, and the comments shall become a part of the director’s file and shall accompany every copy of a report distributed or disclosed for any reason about the producer as permitted under subsection (6) of this section.

(5) Immunities.

(a) In the absence of actual malice, an insurer, the authorized representative of the insurer, a producer, the director, or an organization of which the director is a member and that compiles information and makes it available to other insurance directors or regulatory or law enforcement agencies, shall not be subject to civil liability, and a civil cause of action of any nature shall not arise against these entities or their respective agents or employees as a result of any statement or information required by or provided pursuant to this section or any information relating to any statement that may be requested in writing by the director from an insurer or producer or as a result of any statement by a terminating insurer or producer to an insurer or producer limited solely and exclusively to whether a termination for cause under subsection (1) of this section was reported to the director, provided that the propriety of any termination for cause under subsection (1) of this section is certified in writing by an officer or authorized representative of the insurer or producer terminating the relationship.

(b) In any action brought against a person that may have immunity under paragraph (a) of this subsection for making any statement required by this section or providing any information relating to any statement that may be requested by the director, the party bringing the action shall plead specifically in any allegation that paragraph (a) of this subsection does not apply because the person making the statement or providing the information did so with actual malice.

(c) Paragraph (a) or (b) of this subsection shall not abrogate or modify any existing statutory or common law privileges or immunities.

(6) Confidentiality.

(a) Any documents, materials or other information obtained by the director in an investigation pursuant to this section shall be exempt from public disclosure under chapter 1, title 74 , Idaho Code.

(b) In order to assist in the performance of the director’s duties under this chapter, the director:

(i) May share documents, materials or other information, including confidential and privileged documents and materials or information subject to paragraph (a) of this subsection, with other state, federal and international regulatory agencies and law enforcement authorities, and with the national association of insurance commissioners, its affiliates or subsidiaries, provided that the recipient agrees to maintain the confidentiality and privileged status of the documents, materials or other information;

(ii) May receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the national association of insurance commissioners, its affiliates or subsidiaries and from regulatory agencies and law enforcement authorities of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any documents, materials or information received with notice or with the understanding that they are confidential or privileged under the laws of the jurisdiction that is the source of the documents, materials or information; and

(iii) May enter into agreements governing sharing and use of information consistent with this subsection.

(c) No waiver of any applicable privilege or claim of confidentiality in the documents, materials or information shall occur as a result of disclosure to the director under this section or as a result of sharing as authorized in paragraph (b) of this subsection.

(d) Nothing in this chapter shall prohibit the director from releasing final adjudicated actions, including for cause terminations that are open to public inspection pursuant to chapter 1, title 74 and title 41 , Idaho Code, to a database or other clearinghouse service maintained by the national association of insurance commissioners or its affiliates or subsidiaries.

(7) Penalties for failing to report. An insurer, the authorized representative of the insurer, or a producer who fails to report as required under the provisions of this section or who is found by a court of competent jurisdiction to have reported with actual malice may, after notice and hearing, have his license or certificate of authority suspended or revoked and may be fined in accordance with section 41-1016 or 41-327 , Idaho Code.

Legislative History: [41-1019, added 2001, ch. 296, sec. 3, p. 1058; am. 2015, ch. 141, sec. 109, p. 457.]

I.C. § 41-1020: Reciprocity¶

(1) The director shall waive any requirements, except the requirements imposed by section 41-1009 , Idaho Code, for a nonresident producer license applicant with a valid license from his or her home state if the applicant’s home state awards nonresident licenses to residents of this state on the same basis.

(2) A nonresident producer’s satisfaction of his or her home state’s continuing education requirements for licensed insurance producers shall constitute satisfaction of this state’s continuing education requirements if the nonresident producer’s home state recognizes the satisfaction of its continuing education requirements imposed upon producers from this state on the same basis.

Legislative History: [41-1020, added 2001, ch. 296, sec. 3, p. 1060.]

I.C. § 41-1021: Reporting of actions¶

(1) A producer shall report to the director any administrative action taken against the producer in another jurisdiction or by another governmental agency within thirty (30) days of the final disposition of the matter. This report shall include a copy of the order, consent order or other relevant legal documents.

(2) Within thirty (30) days of the initial pretrial hearing date, a producer shall report to the director any criminal prosecution of the producer taken in any jurisdiction. The report shall include a copy of the initial complaint filed, the order resulting from the hearing and any other relevant legal documents.

Legislative History: [41-1021, added 2001, ch. 296, sec. 3, p. 1060.]

I.C. § 41-1022: Insurers must accept business through licensed producers only¶

(1) No authorized insurer shall make, write, place or cause to be made, written or placed in this state any policy, duplicate policy, or insurance contract of any kind, covering a subject of insurance resident, located or to be performed in this state through any person who is not then licensed as a producer under this chapter.

(2) The director may penalize, suspend or revoke the certificate of authority of any insurer violating this section in accordance with section 41-327 (1), Idaho Code.

Legislative History: [41-1022, added 2001, ch. 296, sec. 3, p. 1061.]

I.C. § 41-1023: Countersignature of policies — Power of attorney¶

(1) When the signature or countersignature of a property or casualty producer is required on an insurance contract, or rider or endorsement thereto, the producer shall, except as provided in section 41-337 (1), Idaho Code, and subsection (2) of this section, affix his original written signature thereon.

(2) The property or casualty producer may grant a power of attorney in writing to an individual who is twenty-one (21) years of age or older, authorizing such person to countersign or cause a facsimile of the agent’s signature to be placed on policies and endorsements in his name and on his behalf. The power of attorney shall be acknowledged by the agent under oath before a notary public and shall be kept on file in the agent’s office.

Legislative History: [41-1023, added 2001, ch. 296, sec. 3, p. 1061.]

I.C. § 41-1024: Reporting and accounting for premiums¶

(1) All fiduciary funds received or collected by a producer shall be trust funds received by the producer in a fiduciary capacity, and the producer shall, in the applicable regular course of business, account for and pay the same to the person entitled to the funds. The producer shall establish a separate account for funds belonging to others in order to avoid a commingling of such fiduciary funds with his own funds. The producer may deposit and commingle in such separate account all fiduciary funds so long as the amount of such deposit so held for all other persons is reasonably ascertainable from the records and accounts of the producer. A producer who duly collects and deposits funds into a sweep account maintained by or for the benefit of an applicable insurer shall not be deemed to be in violation of the fiduciary fund account requirement. The director may promulgate rules relating to accounting for and handling of fiduciary funds and the fiduciary fund account.

(2) Fiduciary funds shall include all funds collected by an insurance producer from or on behalf of a client or premium finance company that are to be paid to an insurance company, its agents, or the producer’s employer, and all funds collected by an insurance producer from an insurance company or its agents that are to be paid to a policyholder or claimant under any contract of insurance.

(3) Any producer who, not being lawfully entitled thereto, diverts or appropriates to his own use such trust or fiduciary funds or any portion thereof, whether or not such funds have been separately deposited, shall upon conviction be guilty of a felony.

Legislative History: [41-1024, added 2001, ch. 296, sec. 3, p. 1061; am. 2005, ch. 62, sec. 1, p. 220.]

I.C. § 41-1025: Rules¶

The director may, in accordance with section 41-211 , Idaho Code, promulgate reasonable rules as are necessary or proper to carry out the purposes of this chapter.

Legislative History: [41-1025, added 2001, ch. 296, sec. 3, p. 1061.]

I.C. § 41-1026: Procedure following suspension, revocation, denial — Reinstatement¶

(1) Upon suspension, revocation, or refusal to continue any license, the director shall notify the licensee as provided in section 41-212 (3), Idaho Code, and, in the case of a producer who holds appointments from insurers, shall give like notice to the insurers represented.

(2) Suspension, revocation, or refusal of any one (1) license held by the licensee under title 41 , Idaho Code, shall automatically suspend, revoke or refuse continuation of all other licenses held by the licensee under title 41 , Idaho Code.

(3) The director shall not issue a license under title 41 , Idaho Code, to or as to any person whose license has been revoked or continuance refused until after the expiration of not less than one (1) year, to a maximum of five (5) years, from the date of such revocation or refusal, which time period shall be set forth in the final order, or, if judicial review of such revocation or refusal is sought, not less than one (1) year, to a maximum of five (5) years, from the date of a final court order or decree affirming the revocation or refusal. If no time period is specified in the final order or final court order or decree, the time period shall be one (1) year. In the event the former licensee again files an application for a license under title 41 , Idaho Code, the director may require the applicant to show good cause why the prior revocation or refusal to continue his license shall not be deemed a bar to the issuance of a new license.

(4) The director shall not issue a license under title 41 , Idaho Code, to any person whose application for a license was previously denied until after the expiration of one (1) year from the date of such license denial or, if judicial review of such license denial is sought, one (1) year from the date of a final court order or decree affirming the license denial.

Legislative History: [41-1026, added 2001, ch. 296, sec. 3, p. 1061; am. 2016, ch. 50, sec. 2, p. 146.]

I.C. § 41-1028: Inactive status¶

(1) Any individual producer who does not want to actively continue in the business of insurance may apply for inactive status of his license on forms prescribed by the director. The director, in his discretion, may grant or deny the application for inactive status and shall notify the licensee of this decision in writing. Inactive status of a license, once granted, shall apply to all licenses held by the licensee and shall continue in force until reactivated pursuant to this section or until the license is suspended or revoked pursuant to this chapter.

(2) During the period that a licensee remains on inactive status, the licensee may not transact the business of insurance in this state or engage in any other insurance activity which requires an active license. A licensee on inactive status may, subject to the terms of an insurer’s contract with the licensee, continue to receive commissions or other compensation relative to business written by such licensee during active license status.

(3) Any individual producer whose license is placed on inactive status shall be exempt from compliance with continuing education requirements.

(4) An individual producer whose license is placed on inactive status shall be subject to payment of the applicable continuation fees.

(5) An individual producer whose license is on inactive status may apply for reactivation of a license on forms prescribed by the director. The request for reactivation shall include proof of completion of twenty (20) hours of continuing education earned during the twelve (12) months prior to reactivation or proof that the producer has retested and met the examination requirements as to any line or kind of insurance to be transacted under the reactivated license. The director, in his discretion, may grant or deny the application for reactivation.

Legislative History: [41-1028, added 2001, ch. 296, sec. 3, p. 1062.]

I.C. § 41-1029: Severability¶

If any provision of this chapter or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this chapter which can be given effect without the invalid provision or application, and to this end the provisions of this chapter are severable.

Legislative History: [41-1029, added 2001, ch. 296, sec. 3, p. 1062.]

I.C. § 41-1030: Producer compensation¶

(1) For purposes of this section:

(a) "Consumer" means an insured, a prospective insured or an employer group.

(b) "Retail producer" means a producer who solicits, negotiates with or sells an insurance contract directly to a consumer.

(c) "Wholesale producer" means a producer who solicits, negotiates or sells an insurance contract directly with a retail producer, but not with a consumer.

(2) Notwithstanding any other provision of title 41 , Idaho Code, and as provided in this subsection, retail producers and wholesale producers may charge a fee or be compensated by a combination of fees and commissions.

(a) Before charging a fee to a consumer, a retail producer shall provide to the consumer a written statement that describes the services the retail producer will perform and the fees the retail producer will receive. Acceptance by the consumer of a fee arrangement shall be evidenced by the consumer signing and dating the fee statement.

(b) Before charging a fee to a retail producer, a wholesale producer shall provide to the retail producer a written statement that describes the services the wholesale producer will perform and the fees the wholesale producer will receive. Information regarding the amount of the fees charged by the wholesale producer shall be disclosed in writing on the face of the policy as a separately itemized charge.

Legislative History: [41-1030, added 2002, ch. 359, sec. 1, p. 1017.]

I.C. § 41-1036: Records¶

(1) A producer holding a license under this chapter shall make available through his principal place of business complete records of transactions placed through or countersigned by the producer.

(2) Records as provided in subsection (1) of this section shall include, but not be limited to:

(a) The names and addresses of insurer and insured;

(b) The number and expiration date of the policy or contract;

(c) The premium payable as to the policy or contract;

(d) The date, time, insurer, insured and coverage of every binder made by the producer;

(e) All disclosures made by a producer to an insured or to a prospective insured; and

(f) Such other information as the director may reasonably require.

(3) The records shall be kept available for inspection by the director for at least five (5) years after the creation or the completion, whichever is later, of the respective transactions. The records may be maintained off-site and in electronic form if the records can be made available for inspection through the producer’s principal place of business upon reasonable notice by the director.

Legislative History: [41-1036, added 2001, ch. 162, sec. 1, p. 571; am. 2002, ch. 281, sec. 4, p. 824; am. 2007, ch. 278, sec. 1, p. 809.]

I.C. § 41-1037: Requirements for bail agents — findings — purpose¶

(1) Sections 41-1037 through 41-1045 , Idaho Code, provide requirements for the regulation of bail agents in this state in addition to the requirements generally applicable to producers under this chapter.

(2) The legislature finds that:

(a) Bail agents provide an important local retail service to the retail consumers of bail bonds;

(b) Retail consumers of bail bonds and bail agents require a uniform and consistent regulatory framework that governs retail bail practices; and

(c) There is a need to provide consumer protection from unscrupulous and unfair practices.

(3) The purpose of this chapter is to provide that the department shall uniformly and exclusively license bail agents throughout the state of Idaho and that the department shall regulate such agents and bail transactions, provided the supreme court shall retain its inherent authority to regulate the transaction of bail with the court, including promulgating rules and uniform guidelines.

Legislative History: [41-1037, added 2003, ch. 104, sec. 1, p. 328; am. 2010, ch. 86, sec. 1, p. 165.]

I.C. § 41-1038: Definitions¶

As used in sections 41-1037 through 41-1045 , Idaho Code:

(1) "Bail" means a monetary amount required by the court to release the defendant from custody and to ensure his appearance in court as ordered.

(2) "Bail agent" means a person who is a licensed producer in the line of surety insurance that is authorized by an insurer to execute or countersign undertakings of bail in connection with judicial proceedings.

(3) "Bail bond" means a financial guarantee, posted by a bail agent and underwritten by a surety insurance company, that the defendant will appear as ordered.

(4) "Collateral" means property of any kind given as security to obtain a bail bond.

(5) "Department" means the department of insurance.

(6) "Director" means the director of the department of insurance.

(7) "Person" means an individual or a business entity.

(8) "Retail consumers of bail bonds" means a defendant and any person who provides collateral to obtain any portion of a bail bond.

(9) "Surety" or "surety insurance company" means an admitted insurer authorized in the line of surety pursuant to title 41 , Idaho Code.

Legislative History: [41-1038, added 2003, ch. 104, sec. 2, p. 329; am. 2010, ch. 86, sec. 2, p. 165.]

I.C. § 41-1039: notice¶

41-1039A. notice. In the event that the director revokes or suspends a bail agent’s license or a surety’s certificate of authority, or lifts such revocation or suspension, the director shall immediately notify all judicial district trial court administrators and all sureties with whom the agent is appointed of the effective date of such revocation or suspension or of the lifting of such revocation or suspension.

Legislative History: [41-1039A, added 2010, ch. 86, sec. 4, p. 167.]

I.C. § 41-1040: Bond required¶

After January 1, 2004, a producer shall not act as a bail agent unless the producer first files with the department and thereafter maintains in force a surety performance bond, executed by an authorized surety insurer, in favor of the director in the amount of fifteen thousand dollars ($15,000). Such bond shall be held in trust for the benefit and protection of the public against a judicial or administrative determination by the department of loss by acts of fraud or dishonesty by the bail agent.

Legislative History: [41-1040, added 2003, ch. 104, sec. 4, p. 329; am. 2010, ch. 86, sec. 5, p. 167.]

I.C. § 41-1041: Records¶

(1) The bail agent shall provide copies of the bail contract, premium receipts, collateral receipts, and any related documents to the defendant and any cosigner at the time of the bail transaction.

(2) In addition to the records set forth in section 41-1036 , Idaho Code, a bail agent shall also maintain complete records pertaining to any collateral received and any charges collected for any bail bond transaction for at least five (5) years after the liability of the surety has been terminated.

Legislative History: [41-1041, added 2003, ch. 104, sec. 5, p. 329.]

I.C. § 41-1042: Collections and charges permitted¶

(1) Notwithstanding any other provision of this chapter, a bail agent in any bail transaction shall not, directly or indirectly, charge or collect money or other valuable consideration from any person except for the following:

(a) To pay premiums at the rates established by the insurer;

(b) To provide collateral;

(c) To reimburse the bail agent for actual expenses incurred in connection with the bail transaction, limited to the following:

(i) Expenditures actually and reasonably incurred to verify underwriting information or to pay for notary public fees, recording fees, or necessary long distance telephone or telegram fees; provided however, that the total of all such expenditures reimbursed shall not exceed fifty dollars ($50.00); and

(ii) Travel expenses incurred more than twenty-five (25) miles from a bail agent’s place of business, which includes any city or locality in which the bail agent advertises or engages in bail business, up to the amount allowed by the internal revenue service for business travel for the year in which the travel occurs.

(2) Except as permitted under this section, a bail agent shall not make any charge for his service in a bail transaction and the bail agent shall fully document all expenses for which the bail agent seeks reimbursement.

Legislative History: [41-1042, added 2003, ch. 104, sec. 6, p. 330.]

I.C. § 41-1043: Collateral¶

(1) A bail agent may accept collateral in connection with the bail bond transaction if the collateral is not excessive in relation to the face amount of the bond.

(2) All collateral received by a bail agent is received in a fiduciary capacity.

(a) Collateral received in the form of cash must be deposited and maintained in a trust account that is separate and apart from any other funds or assets of the bail agent.

(b) Collateral other than cash must be maintained in a separate and secure location apart from the assets of the bail agent.

(3) Collateral received must be returned to the person who deposited the collateral with the bail agent within fourteen (14) days of the date notice is received that the obligation, the satisfaction of which was secured by collateral, is discharged.

(4) A copy of the order of the court wherein the bail or undertaking was ordered exonerated shall be deemed prima facie evidence of exoneration or termination of the liability.

(5) If a bail agent accepts collateral, the bail agent shall give a written receipt for the collateral to the person from whom the collateral was received. The receipt shall include a full and detailed accounting of the collateral received.

Legislative History: [41-1043, added 2003, ch. 104, sec. 7, p. 330.]

I.C. § 41-1044: Early surrender of defendant to custody — Return of premium¶

(1) A bail agent shall immediately return in full all premium and collateral associated with a bail transaction if the bail agent without good cause or in violation of the bail contract surrenders the defendant to custody before the time specified in the undertaking of bail or the bail bond for the appearance of the defendant or, if no time is specified in the undertaking or bond, before the time the defendant is lawfully required to appear in court.

(2) A bail agent has good cause for the early surrender of a defendant if the defendant has changed addresses without notifying the bail agent, engaged in self-concealment, left the jurisdiction of the court without permission of the bail agent or the court, materially breached the terms of the bail contract, or has otherwise acted in a manner that materially increases the risk of loss assumed by the bail agent or surety. A failure to pay the premium when due shall constitute good cause for early surrender only if at the time of the bail transaction the bail agent obtains the payor’s signature on a written statement clearly stating the amount of premium due, the date by which the premium must be paid and that the failure to pay the premium by the due date will result in the early surrender of the defendant and forfeiture of any premium paid.

(3) Before surrendering a defendant early for good cause, a bail agent shall prepare a signed and dated written statement fully describing the facts upon which the agent relied in determining that good cause exists for the early surrender of the defendant. The statement shall be maintained as a record of the bail transaction and shall be made available to the department upon request. A bail agent who surrenders a defendant early for good cause shall not be entitled to seek recovery of any unpaid premium.

Legislative History: [41-1044, added 2003, ch. 104, sec. 8, p. 331.]

I.C. § 41-1045: Responsibility for actions of others¶

For purposes of licensing and regulation under title 41 , Idaho Code, a bail agent is responsible for the actions of the bail agent’s employees, contractors and agents acting on the bail agent’s behalf in relation to bail transactions and matters arising out of bail transactions.

Legislative History: [41-1045, added 2003, ch. 104, sec. 9, p. 331.]

I.C. § 41-1081: REQUIREMENTS FOR SALE OF PORTABLE ELECTRONICS INSURANCE — FINDINGS — PURPOSE¶

(1) Sections 41-1081 through 41-1089 , Idaho Code, set forth requirements for the sale of portable electronics insurance in this state.

(2) The legislature finds that portable electronics insurers and insurance producers who sell, solicit or negotiate the offer or sale of such insurance in this state shall be supervised and regulated by the department of insurance in a uniform and consistent manner.

Legislative History: [41-1081, added 2012, ch. 226, sec. 3, p. 620.]

I.C. § 41-1082: definitions¶

As used in sections 41-1081 through 41-1089 , Idaho Code:

(1) "Customer" means a person who purchases portable electronics or services.

(2) "Enrolled Customer" means a customer who purchases coverage under a portable electronics insurance policy issued to a vendor of portable electronics, which vendor would be the insured under a master or group policy.

(3) "Location" means any physical location in the state of Idaho or any website, call center site or similar location directed to residents of the state of Idaho.

(4) "Portable electronics" means electronic devices that are portable in nature and includes accessories and any services related to the use of such device.

(5) (a) "Portable electronics insurance" means insurance providing coverage for the repair or replacement of portable electronics against any one (1) or more of the following causes of loss: loss of the portable electronic device, theft, inoperability due to mechanical failure, malfunction, damage or other similar causes of loss;

(b) "Portable electronics insurance" does not include:

(i) A service contract as defined in section 41-114A , Idaho Code;

(ii) A policy of insurance covering a seller’s or a manufacturer’s obligations under a warranty; or

(iii) A homeowner’s, renter’s, private passenger automobile, commercial multi-peril or similar insurance policy.

(6) "Portable electronics transaction" means:

(a) The sale or lease of portable electronics by a vendor to a customer; or

(b) The sale of a service related to the use of portable electronics by a vendor to a customer.

(7) "Supervising entity" means a business entity that is a licensed insurer or insurance producer that is authorized by an insurer to supervise the administration of a portable electronics insurance program.

(8) "Vendor" means a person in the business of engaging in portable electronics transactions directly or indirectly.

Legislative History: [41-1082, added 2012, ch. 226, sec. 4, p. 621.]

I.C. § 41-1083: LICENSURE OF VENDORS¶

(1) A vendor is required to hold a limited lines license to sell or offer coverage under a policy of portable electronics insurance.

(2) A limited lines license issued pursuant to the provisions of this section shall authorize any employee or authorized representative of the vendor to sell or offer coverage under a policy of portable electronics insurance to a customer at each location at which the vendor engages in portable electronics transactions.

(3) The supervising entity shall maintain a registry of vendor locations that are authorized to sell or solicit portable electronics insurance coverage in this state. Upon request by the director to the supervising entity, the registry shall be open to inspection and examination by the director during regular business hours of the supervising entity.

(4) Notwithstanding any other provision of law, a limited lines license issued pursuant to this section shall authorize the licensee and its employees or authorized representatives to engage in those activities that are permitted in this section.

Legislative History: [41-1083, added 2012, ch. 226, sec. 5, p. 621.]

I.C. § 41-1084: REQUIREMENTS FOR SALE OF PORTABLE ELECTRONICS INSURANCE¶

(1) At every location where portable electronics insurance is offered or sold to customers, brochures or other written materials must be provided by the vendor to a prospective customer which:

(a) Disclose that portable electronics insurance may duplicate coverage already provided by a customer’s homeowner’s insurance policy, renter’s insurance policy or other source of insurance coverage;

(b) State that the purchase by the customer of a portable electronics insurance policy is not required in order to purchase or lease portable electronics or related services;

(c) Summarize the material terms of the insurance coverage, including:

(i) The identity of the insurer;

(ii) The identity and contact information of the supervising entity;

(iii) The amount of any applicable deductible and how it is to be paid;

(iv) Benefits of the insurance coverage; and

(v) Key terms and conditions of the insurance coverage such as whether portable electronics may be repaired or replaced with similar make and model, reconditioned or nonoriginal manufacturer parts or equipment;

(d) Set forth the process for filing a claim, including a description of how to return portable electronics and any deadlines applicable thereto, any fees that may apply and the maximum fee applicable in the event the customer fails to comply with any equipment return requirements; and

(e) State that an enrolled customer may cancel enrollment for coverage under a portable electronics insurance policy at any time and that the person who paid the premium shall receive a pro rata refund or credit of any applicable unearned premium.

(2) The director may order a vendor to stop using any brochure or other written material that violates the requirements of this section or is otherwise found to be misleading or false.

(3) Portable electronics insurance may be offered on a month to month or other periodic basis as a group or master commercial inland marine policy issued to a vendor of portable electronics for its enrolled customers.

(4) Eligibility and underwriting standards for customers electing to purchase portable electronics insurance coverage shall be established for each portable electronics insurance program by the insurer issuing a policy to a vendor.

Legislative History: [41-1084, added 2012, ch. 226, sec. 6, p. 622.]

I.C. § 41-1085: AUTHORITY OF VENDORS OF PORTABLE ELECTRONICS¶

(1) Notwithstanding any other provision of law, the employees and authorized representatives of vendors may sell or offer portable electronics insurance to customers and shall not be subject to licensure as an insurance producer under the provisions of this chapter provided that:

(a) The vendor obtains a limited lines license to authorize its employees or authorized representatives to sell or offer portable electronics insurance pursuant to the provisions of this section;

(b) The insurer issuing the portable electronics insurance either directly supervises or appoints a supervising entity who shall supervise the administration of the program, to include development of a training program for employees and authorized representatives of the vendors concerning the applicable requirements of this chapter prior to the transaction of any personal electronics insurance. The training required by the provisions of this section shall comply with the following:

(i) The training shall be delivered to employees and authorized representatives of a vendor who are directly engaged in the activity of selling or offering portable electronics insurance;

(ii) The training may be provided in electronic form. However, if conducted in an electronic form, the supervising entity shall implement a supplemental education program regarding the portable electronics insurance product being offered or sold that is conducted and overseen by employees of the supervising entity that are licensed pursuant to this chapter;

(iii) Each employee and authorized representative shall receive basic instruction concerning the portable electronics insurance offered to customers and the disclosures required pursuant to section 41-1084 , Idaho Code; and

(c) No employee or authorized representative of a vendor of portable electronics shall advertise, represent or otherwise hold himself out as a limited lines or other licensed insurance producer.

(2) The charges for portable electronics insurance coverage may be billed and collected by the vendor of portable electronics. Any charge to the enrolled customer for portable electronics insurance coverage that is not included in the cost associated with the purchase or lease of portable electronics or related services shall be separately itemized on the enrolled customer’s bill. If the portable electronics insurance coverage is included with the purchase or lease of portable electronics or related services, the vendor shall clearly and conspicuously disclose to the enrolled customer that the portable electronics insurance coverage is included in the portable electronics or related services purchased. Vendors billing and collecting such charges shall not be required to maintain such funds in a segregated account, provided that the vendor is authorized by the insurer to hold such funds in a nonsegregated account and is required to remit such amounts to the supervising entity within sixty (60) days of receipt. All funds received by a vendor from an enrolled customer for the sale of portable electronics insurance shall be considered funds held in trust by the vendor in a fiduciary capacity for the benefit of the insurer. Failure to do so is a violation of this section. Vendors may receive compensation for billing and collection services.

Legislative History: [41-1085, added 2012, ch. 226, sec. 7, p. 622.]

I.C. § 41-1086: RESPONSIBILITY FOR ACTIONS OF OTHERS¶

For purposes of licensing and regulation under title 41 , Idaho Code, a portable electronics limited lines licensee shall be responsible for the actions of the licensee’s employees and authorized representatives acting on the licensee’s behalf in relation to portable electronics insurance transactions and matters arising out of the same. Any violation of this chapter by the licensee’s employees and authorized representatives acting on the licensee’s behalf shall be considered a violation by the licensee.

Legislative History: [41-1086, added 2012, ch. 226, sec. 8, p. 623.]

I.C. § 41-1087: SUSPENSION OR REVOCATION OF LICENSE¶

If a vendor of portable electronics or its employee or authorized representative violates any applicable provision of this chapter including, but not limited to, section 41-1016 , Idaho Code, or applicable provisions of chapter 13, title 41 , Idaho Code, or an applicable rule, the director may:

(1) Impose an administrative penalty pursuant to section 41-117 , Idaho Code. However, penalties arising from the same or similar conduct shall not exceed fifty thousand dollars ($50,000) in the aggregate; and

(2) Impose other penalties that the director deems necessary and reasonable, including:

(a) Prohibiting such vendor from transacting portable electronics insurance pursuant to the provisions of this section at specific business locations where violations have occurred or from using specific employees or representatives in the transaction of portable electronics insurance; and

(b) Suspending, revoking or refusing to renew the license of such vendor.

Legislative History: [41-1087, added 2012, ch. 226, sec. 9, p. 624.]

I.C. § 41-1088: TERMINATION OF PORTABLE ELECTRONICS INSURANCE¶

Notwithstanding any other provision of law:

(1) An insurer may terminate or otherwise change the terms and conditions of a policy of portable electronics insurance only upon providing the policyholder and enrolled customers with at least thirty (30) days’ notice.

(2) If the insurer changes the terms and conditions, then the insurer shall provide the vendor policyholder with a revised policy or endorsement and each enrolled customer with a revised certificate, endorsement, updated brochure or other evidence indicating that a change in the terms and conditions has occurred and a summary of material changes. An enrolled customer shall be entitled to reject any change to the terms and conditions or cancel coverage, and the person who paid the premium shall receive a pro rata refund or credit of any applicable unearned premium within sixty (60) days of the receipt of notice from the customer that he wishes to cancel coverage.

(3) Notwithstanding subsection (1) of this section, an insurer may terminate an enrolled customer’s enrollment under a portable electronics insurance policy upon fifteen (15) days’ notice for discovery of fraud or material misrepresentation in obtaining coverage or in the presentation of a claim thereunder.

(4) Notwithstanding subsection (1) of this section, an insurer may immediately terminate an enrolled customer’s enrollment under a portable electronics insurance policy:

(a) For nonpayment of premium;

(b) If the enrolled customer ceases to have an active service with the vendor of portable electronics; or

(c) If an enrolled customer exhausts the aggregate limit of liability under the terms of the portable electronics insurance policy and the insurer sends notice of termination to the enrolled customer within thirty (30) calendar days after exhaustion of the limit. However, if notice is not timely sent, enrollment shall continue notwithstanding the aggregate limit of liability until the insurer sends notice of termination to the enrolled customer and specifies the date of such termination.

(5) Where a portable electronics insurance policy is terminated by a policyholder, the policyholder shall mail or deliver written notice to each enrolled customer advising the enrolled customer of the termination of the policy and the effective date of termination. The written notice shall be mailed or delivered to the enrolled customer at least thirty (30) days prior to the termination, and any unearned premium shall be returned to the policyholder within sixty (60) days of such termination.

(6) An enrolled customer may cancel enrollment for coverage under a portable electronics insurance policy at any time, and the person paying the premium shall receive a pro rata refund or credit of any applicable unearned premium within sixty (60) days of the receipt of notice of cancellation from the customer.

(7) Whenever notice or correspondence with respect to a policy of portable electronics insurance is required pursuant to the provisions of this section or is otherwise required by law, it shall be in writing and sent within the required notice period, if any, specified within the statute or regulation requiring the notice or correspondence. Notwithstanding any other provision of law, notices and correspondence may be sent either by mail or by electronic means if agreed to by the customer pursuant to section 28-50-105 , Idaho Code, and as set forth in this subsection. If the notice or correspondence is mailed, it shall be sent to the vendor of portable electronics at the vendor’s mailing address specified for such purpose and to each affected enrolled customer’s last known mailing address on file with the insurer. The insurer or vendor of portable electronics, as the case may be, shall maintain proof of mailing in a form authorized or accepted by the United States postal service or other commercial mail delivery service. If the notice or correspondence is sent by electronic means, it shall be sent to the vendor of portable electronics at the vendor’s electronic mail address specified for such purpose and to each affected enrolled customer’s last known electronic mail address as provided by each enrolled customer to the insurer or vendor of portable electronics at the time of purchase of the portable electronics insurance coverage. For purposes of this subsection, an enrolled customer’s provision of an electronic mail address to the insurer or vendor of portable electronics shall be deemed consent to receive notices and correspondence by electronic means at such address as long as notice of that consent is provided to the customer within thirty (30) days or less by mail or electronic means. The insurer or vendor of portable electronics shall maintain proof that the notice or correspondence was sent.

(8) Notice or correspondence required by this section or otherwise required by law may be sent on behalf of an insurer or vendor by the supervising entity appointed by the insurer.

Legislative History: [41-1088, added 2012, ch. 226, sec. 10, p. 624; am. 2017, ch. 114, sec. 1, p. 265.]

I.C. § 41-1089: APPLICATION FOR LICENSE AND FEES¶

(1) A sworn application for a limited lines license to sell, solicit or negotiate portable electronics insurance shall be completed and filed with the department of insurance on forms prescribed by the director to include such information as the director deems necessary.

(2) The application shall:

(a) Provide the name, residence address and other information required by the director for an employee or officer of the vendor that is designated by the applicant as the person responsible for the vendor’s compliance with the requirements of this chapter, which designation shall satisfy the requirements of section 41-1007 (2)(b), Idaho Code. However, if the vendor derives more than fifty percent (50%) of its revenue from the sale of portable electronics insurance, the information noted in this subsection shall be provided for all officers, directors, and shareholders of record having beneficial ownership of ten percent (10%) or more of the vendor;

(b) Provide the location of the applicant’s home office, both street address and mailing address, and phone number where such applicant may be reached during regular business hours; and

(c) Provide the syllabus for the training program that is developed by the supervising entity or the insurer that issued the portable electronics insurance policy to the vendor.

(3) Any vendor engaging in portable electronics insurance transactions on or before the effective date of sections 41-1081 through 41-1089 , Idaho Code, must apply for licensure within ninety (90) days of the application being made available to the vendor by the director. Any applicant commencing operations after the effective date of sections 41-1081 through 41-1089 , Idaho Code, must obtain a license prior to offering or selling portable electronics insurance.

(4) Notwithstanding any other provision of law, applicants for licensure pursuant to sections 41-1081 through 41-1089 , Idaho Code, whose home state does not issue a producer license with a similar line of authority as the license authorized by such sections shall be issued a portable electronics limited lines license upon satisfying all applicable requirements of this chapter. However, any licensee whose home state does not authorize a limited lines license for portable electronics insurance in its home state after July 1, 2014, or such later date as may be determined by the director, shall obtain a property and casualty license under title 41 , Idaho Code, or its license shall terminate in Idaho. For the purposes of this subsection, "home state" means the District of Columbia and any state or territory of the United States except Idaho, or any province of Canada, in which an applicant maintains such person’s principal place of residence or principal place of business.

(5) Initial licenses issued pursuant to sections 41-1081 through 41-1089 , Idaho Code, shall be valid for a period of twenty-four (24) months and expire thereafter unless renewed by the director upon completion of forms required by the director and payment of fees consistent with the provisions of this chapter.

(6) Each vendor of portable electronics licensed pursuant to this chapter shall pay to the director a fee of one thousand dollars ($1,000) for an initial portable electronics limited lines license and five hundred dollars ($500) for each renewal thereof. However, for a vendor engaged in portable electronics transactions at ten (10) or fewer locations in the state of Idaho, the fee shall not exceed one hundred dollars ($100) for an initial license and for each renewal thereof.

Legislative History: [41-1089, added 2012, ch. 226, sec. 11, p. 625.]

I.C. § 41-1090: SHORT TITLE¶

Sections 41-1090 through 41-1096 , Idaho Code, shall be known and may be cited as the "Limited Lines Travel Insurance Act."

Legislative History: [41-1090, added 2017, ch. 198, sec. 2, p. 495.]

I.C. § 41-1091: DEFINITIONS¶

As used in this chapter:

(1) "Designated responsible producer" means the individual licensed producer responsible for ensuring compliance by the limited lines travel insurance producer with travel insurance laws and rules of the state, as set forth in section 41-1092 (2)(c), Idaho Code.

(2) "Limited lines travel insurance producer" means a person who is a limited lines producer as defined in section 41-1003 , Idaho Code.

(3) "Offer and disseminate" means providing general information, including a description of the coverage and price, as well as processing the application, collecting premiums and performing other activities permitted by the state.

(4) "Travel insurance" means insurance coverage for personal risks incident to planned travel including, but not limited to:

(a) Interruption or cancellation of a trip or event;

(b) Loss of baggage or personal effects;

(c) Damages to accommodations or rental vehicles; and

(d) Sickness, accident, disability or death occurring during travel.

"Travel insurance" does not include major medical plans that provide comprehensive medical protection for travelers with trips lasting six (6) months or longer, including those working overseas as an expatriate or military personnel being deployed.

(5) "Travel retailer" means a business entity that makes, arranges or offers travel services and may offer and disseminate travel insurance as a service to its customers on behalf of and under the direction of a limited lines travel insurance producer.

Legislative History: [41-1091, added 2017, ch. 198, sec. 3, p. 495.]

I.C. § 41-1092: REQUIREMENTS for limited lines travel insurance producers¶

Notwithstanding any other provision of law:

(1) The director may issue to an individual or business entity that has filed with the director an application, in a form and manner prescribed by the director, a limited lines travel insurance producer license that authorizes the limited lines travel insurance producer to sell, solicit or negotiate travel insurance on behalf of a licensed insurer.

(2) A travel retailer may offer and disseminate travel insurance under a limited lines travel insurance producer’s business entity license only if the following conditions are met:

(a) The limited lines travel insurance producer provides to policyholders of travel insurance:

(i) A description of the material terms or the actual material terms of the insurance coverage;

(ii) A description of the process for filing a claim;

(iii) A description of the review or cancellation process for the travel insurance policy, including any forfeiture fees; and

(iv) The identity and contact information of the insurer and limited lines travel insurance producer.

(b) At the time of licensure, the limited lines travel insurance producer shall establish and maintain a register on a form prescribed by the director of each travel retailer that offers travel insurance on the limited lines travel insurance producer’s behalf. The register shall be maintained and updated annually, at a minimum, by the limited lines travel insurance producer and shall include the name, address, and contact information of the travel retailer and an officer or person who directs or controls the travel retailer’s operations, as well as the travel retailer’s federal tax identification number. The limited lines travel insurance producer shall submit such register from the previous year to the department on March 1 of each year. The limited lines travel insurance producer shall also certify that the registered travel retailer complies with 18 U.S.C. 1033. The limited lines travel insurance producer shall report its Idaho annual written premium to the director on an annual basis.

(c) The limited lines travel insurance producer has designated one (1) of its employees, who is a licensed individual producer, as a designated responsible producer who shall be responsible for the limited lines travel insurance producer’s compliance with the travel insurance laws, rules and regulations of the state.

(d) The designated responsible producer, president, secretary, treasurer and any other officer or person who directs or controls the limited lines travel insurance producer’s insurance operations shall comply with the fingerprinting requirements applicable to insurance producers in the resident state of the limited lines travel insurance producer.

(e) The limited lines travel insurance producer has paid all applicable insurance producer licensing fees as set forth in applicable state law.

(f) The limited lines travel insurance producer requires each employee and authorized representative of the travel retailer whose duties include offering and disseminating travel insurance to receive a program of instruction or training that shall be subject to review by the director. The training material shall, at a minimum, contain instructions on the types of insurance offered, ethical sales practices and required disclosures to prospective customers.

(3) Any travel retailer offering or disseminating travel insurance shall make available to prospective purchasers brochures or other written materials that:

(a) Provide the identity and contact information of the insurer and the limited lines travel insurance producer;

(b) Explain that the purchase of travel insurance is not required in order to purchase any other product or service from the travel retailer; and

(c) Explain that an unlicensed travel retailer is permitted to provide general information about the insurance offered by the travel retailer, including a description of the coverage and price, but is not qualified or authorized to answer technical questions about the terms and conditions of the insurance offered by the travel retailer or to evaluate the adequacy of the customer’s existing insurance coverage.

(4) A travel retailer’s employees or authorized representatives who are not licensed as insurance producers may not:

(a) Evaluate or interpret the technical terms, benefits and conditions of the offered travel insurance coverage;

(b) Evaluate or provide advice concerning a prospective purchaser’s existing insurance coverage; or

(c) Hold himself or itself out as a licensed insurer, licensed producer or insurance expert.

Legislative History: [41-1092, added 2017, ch. 198, sec. 4, p. 495.]

I.C. § 41-1093: REGISTRATION required¶

A travel retailer, whose insurance-related activities and those of its employees and authorized representatives are limited to offering and disseminating travel insurance, on behalf of and under the direction of a limited lines travel insurance producer meeting the conditions stated in this chapter, is authorized to do so and receive related compensation upon registration by the limited lines travel insurance producer as described in section 41-1092 (2)(b), Idaho Code.

Legislative History: [41-1093, added 2017, ch. 198, sec. 5, p. 497.]

I.C. § 41-1094: type of POLICY¶

Travel insurance may be provided under an individual policy or under a group or master policy.

Legislative History: [41-1094, added 2017, ch. 198, sec. 6, p. 497.]

I.C. § 41-1095: RESPONSIBILITY of limited lines travel insurance producers¶

As the insurer designee, the limited lines travel insurance producer is responsible for the acts of the travel retailer and shall use reasonable means to ensure compliance by the travel retailer with this chapter.

Legislative History: [41-1095, added 2017, ch. 198, sec. 7, p. 497.]

I.C. § 41-1096: no negative option or opt out¶

No person offering travel insurance on an individual or group basis may do so using a negative option or option to opt out, that would require a consumer to take an affirmative action to deselect coverage such as unchecking a box on an electronic form when purchasing a trip. It shall not be an unfair trade practice to include blanket travel insurance coverage with the purchase of a trip, provided the coverage is not marketed as free.

Legislative History: [41-1096, added 2017, ch. 198, sec. 8, p. 497.]

I.C. § 41-1097: ENFORCEMENT¶

The limited lines travel insurance producer and any travel retailer offering and disseminating travel insurance under the limited lines travel insurance producer license shall be subject to the provisions of section 41-1016 , Idaho Code, and other applicable provisions of this title. Violations of this act shall be considered an unfair trade practice under chapter 13, title 41 , Idaho Code.

Legislative History: [41-1097, added 2017, ch. 198, sec. 9, p. 498.]

Chapter 11¶

I.C. § 41-1101: Scope of chapter¶

This chapter applies only as to adjusters, as defined in section 41-1102 .

Legislative History: [41-1101, added 1961, ch. 330, sec. 237, p. 645.]

I.C. § 41-1102: "Adjuster" defined¶

(1) An "adjuster" is a person who, on behalf of the insurer, for compensation as an independent contractor or as the employee of such an independent contractor, or for fee or commission, investigates and negotiates settlement of claims arising under insurance contracts.

(2) None of the following is an "adjuster" for the purposes of this chapter:

(a) A licensed attorney at law who is qualified to practice law in this state.

(b) The salaried employee of an authorized insurer, or group of such insurers under common control or ownership, or of a managing general agent, who adjusts losses for such insurer or insurers or for the authorized insurers represented by the general agent.

(c) The licensed agent of an authorized insurer who, at the insurer’s request, from time to time adjusts or assists in adjustment of losses arising under policies issued by such insurer.

(d) An individual who collects claim information from, or furnishes claim information to, claimants or those who are insured and who conducts data entry, including entering data into an automated claims adjudication system, provided that the individual is an employee of a licensed adjuster or its affiliate where no more than twenty-five (25) such persons are under the supervision of one (1) licensed adjuster or licensed agent. A licensed agent who acts as a supervisor or adjusts claims pursuant to the provisions of this paragraph is not required to also be licensed as an adjuster. For purposes of this section, "automated claims adjudication system" means a pre-programmed computer system designed for the collection, data entry, calculation and final resolution of portable electronics insurance claims that:

(i) May only be utilized by a licensed adjuster, licensed agent or supervised individuals operating pursuant to the provisions of this paragraph;

(ii) Must comply with all claims payment requirements of the insurance code; and

(iii) Must be certified as compliant with this section by a licensed adjuster who is an officer of a licensed business entity pursuant to the provisions of this chapter.

Legislative History: [41-1102, added 1961, ch. 330, sec. 238, p. 645; am. 2012, ch. 226, sec. 12, p. 626.]

I.C. § 41-1103: License required¶

No person shall in this state be, act as, or advertise or hold himself out to be, an adjuster unless then licensed as an adjuster under this chapter. No resident of Canada may be licensed as a resident adjuster or may designate Idaho as his home state, unless such person has successfully passed the adjuster examination and has complied with the other applicable provisions of this chapter. No resident of Canada may be licensed as a nonresident adjuster unless such person has obtained a resident or home state adjuster license in another state.

Legislative History: [41-1103, added 1961, ch. 330, sec. 239, p. 645; am. 2012, ch. 226, sec. 13, p. 627.]

I.C. § 41-1104: Qualifications for adjuster’s license¶

(1) Except as provided in subsection (2) of this section, the director shall not issue, continue, or permit to exist any license as an adjuster as to any person not qualified therefor as follows:

(a) Must be a natural person not less than twenty-one (21) years of age.

(b) Must be trustworthy, and be of good character and reputation as to morals, integrity, and financial responsibility, and must not have been convicted of any crime that is deemed relevant in accordance with section 67-9411 (1), Idaho Code.

(c) Must be a salaried employee of a licensed adjuster, or must have had experience or special education or training as to the investigation and settlement of loss of claims under insurance contracts of sufficient duration and extent reasonably to satisfy the director as to his competence to fulfill the responsibilities of an adjuster.

(d) If required by the director, must pass a written examination to test his knowledge of the duties and responsibilities of an adjuster and of matters involved in transactions under an adjuster’s license. The examination shall be subject to the same applicable provisions as apply pursuant to title 41 , Idaho Code, to examinations for license as insurance agent.

(2) A firm or corporation, whether or not organized under the laws of this state, may be licensed as an adjuster if each individual who is to exercise the license powers in this state is separately licensed, or is named in the firm or corporation license, and is qualified as for an individual license as adjuster under subsection (1) of this section. An additional full license fee shall be paid as to each individual in excess of one (1) so named in the firm or corporation license to exercise its powers.

Legislative History: [41-1104, added 1961, ch. 330, sec. 240, p. 645; am. 1969, ch. 214, sec. 38, p. 625; am. 2012, ch. 226, sec. 14, p. 627; am. 2020, ch. 175, sec. 9, p. 513.]

I.C. § 41-1105: Application for license¶

The individual desiring to be licensed as an adjuster shall make written application therefor to the director, on forms as prescribed and furnished by the director. The application shall be accompanied by payment of the fee for the license as set forth by rule pursuant to section 41-401 , Idaho Code.

Legislative History: [41-1105, added 1961, ch. 330, sec. 241, p. 645; am. 2001, ch. 85, sec. 4, p. 214.]

I.C. § 41-1106: Scope of license¶

Under his license an adjuster shall have authority to act as adjuster on behalf of the insurer only as to losses under insurance contracts.

Legislative History: [41-1106, added 1961, ch. 330, sec. 242, p. 645.]

I.C. § 41-1107: Emergency adjusters¶

No adjuster’s license or qualifications shall be required as to any adjuster who is sent into this state by and on behalf of an authorized insurer or adjusting firm or corporation for the purpose of investigating or making adjustment of a particular loss under an insurance policy issued by an authorized insurer or as a lawful surplus line contract, or for the purpose of temporarily assisting or substituting for a licensed adjuster who is incapacitated due to illness, injury, or any unforeseeable or uncontrollable incident, or for the adjustment of a series of losses resulting from a catastrophe common to all such losses.

Legislative History: [41-1107, added 1961, ch. 330, sec. 243, p. 645.]

I.C. § 41-1108: Other provisions applicable¶

The following sections of chapter 10, title 41 , Idaho Code, shall, to the extent so applicable, also apply as to adjuster licenses:

(1) 41-1007(1), Idaho Code (application for producer license).

(2) 41-1008, Idaho Code (producer license).

(3) 41-1011, Idaho Code (issuance, refusal of license).

(4) 41-1013, Idaho Code (continuation, expiration of license, continuing education statement).

(5) 41-1016, Idaho Code (administrative penalty — suspension, revocation, refusal of license).

(6) 41-1026, Idaho Code (procedure following suspension, revocation, denial — reinstatement).

Legislative History: [41-1108, added 1961, ch. 330, sec. 244, p. 645; am. 1972, ch. 164, sec. 2, p. 376; am. 1999, ch. 97, sec. 6, p. 303; am. 2001, ch. 296, sec. 4, p. 1063; am. 2002, ch. 281, sec. 3, p. 824; am. 2016, ch. 50, sec. 3, p. 146; am. 2021, ch. 42, sec. 8, p. 127.]

Chapter 12¶

I.C. § 41-1201: Representing or aiding unauthorized insurer prohibited¶

(1) No person shall in this state directly or indirectly act as agent for, or otherwise represent or aid on behalf of another, any insurer not then authorized to transact such insurance in this state, in the solicitation, negotiation, procurement or effectuation of insurance or annuity contracts, or renewal thereof, or forwarding of applications for insurance, or in the dissemination of information as to coverage or rates, or inspection of risks, or fixing of rates, or investigation or adjustment of claims or losses, or collection or forwarding of premiums, or in any other manner represent or assist such an insurer in the transaction of insurance with respect to subjects of insurance resident, located or to be performed in this state.

(2) This section does not apply to:

(a) Matters authorized to be done by the director under the unauthorized insurers process act, sections 41-1204 through 41-1210 .

(b) Surplus line insurance when written pursuant to the surplus line law, sections 41-1211 through 41-1232 , and coverages specified in section 41-1212 (exemptions from surplus line law).

(c) Any transaction with respect to which the insurer is not required to have a certificate of authority pursuant to section 41-306 (exceptions to certificate of authority requirement).

(d) A licensed adjuster or attorney at law representing such an insurer from time to time in his professional capacity.

Legislative History: [41-1201, added 1961, ch. 330, sec. 245, p. 645.]

I.C. § 41-1202: Representing or aiding unauthorized insurer prohibited — Penalty¶

Any person who violates section 41-1201 shall upon conviction thereof be guilty of a misdemeanor punishable by a fine of not to exceed two thousand dollars ($2,000) or by imprisonment in the county jail for not to exceed six (6) months, or by both such fine and imprisonment in the court’s discretion; except, that the court shall increase the amount of any fine so levied by the full amount of any compensation accruing or to accrue to the violator by reason of the acts out of which the violation arose. Each instance of violation shall be considered a separate offense for the purposes of this section.

Legislative History: [41-1202, added 1961, ch. 330, sec. 246, p. 645.]

I.C. § 41-1203: Suits by unauthorized insurer prohibited¶

(1) No unauthorized insurer shall institute or file, or cause to be instituted or filed, any suit, action or proceeding in this state to enforce any right, claim or demand arising out of any insurance transaction in this state.

(2) This section does not apply as to:

(a) Transactions permitted under section 41-306 (exceptions to certificate of authority requirement).

(b) Coverages exempted from the surplus line law under section 41-1212 .

(c) Counter claim, cross complaint, or similar action by an insurer in connection with a suit brought against the insurer in which service of process on the insurer was made under the unauthorized insurers process act, sections 41-1204 through 41-1210 .

Legislative History: [41-1203, added 1961, ch. 330, sec. 247, p. 645.]

I.C. § 41-1204: Unauthorized insurers process act — Title — Interpretation¶

(1) Sections 41-1204 through 41-1210 constitute and may be cited as the Unauthorized Insurers Process Act.

(2) Such act shall be so interpreted as to effectuate its general purpose to make uniform the law of those states which enact it.

Legislative History: [41-1204, added 1961, ch. 330, sec. 248, p. 645.]

I.C. § 41-1205: Purpose of process act¶

The purpose of the unauthorized insurers process act is to subject certain insurers to the jurisdiction of courts of this state in suits by or on behalf of insureds or beneficiaries under insurance contracts.

The legislature declares that it is a subject of concern that many residents of this state hold policies of insurance issued or delivered in this state by insurers while not authorized to do business in this state, thus presenting to such residents the often insuperable obstacle of resorting to distant forums for the purpose of asserting legal rights under such policies. In furtherance of such state interest, the legislature herein provides a method of substituted service of process upon such insurers and declares that in so doing it exercises its power to protect its residents and to define, for the purpose of this statute, what constitutes doing business in this state, and also exercises powers and privileges available to the state by virtue of Public Law 15, 79th Congress of the United States, chapter 20, 1st session, S. 340, which declares that the business of insurance and every person engaged therein shall be subject to the laws of the several states.

Legislative History: [41-1205, added 1961, ch. 330, sec. 249, p. 645.]

I.C. § 41-1206: Acts constituting director as process agent¶

Any of the following acts in this state, effected by mail or otherwise, by an unauthorized foreign or alien insurer, is equivalent to and shall constitute an appointment by such insurer of the director to be its true and lawful attorney, upon whom may be served all lawful process in any action, suit or proceeding instituted by or on behalf of an insured or beneficiary arising out of any such contract of insurance, and any such act shall be signification of its agreement that such service of process is of the same legal force and validity as personal service of process in this state upon such insurer:

(1) The issuance or delivery of contracts of insurance to residents of this state or to corporations authorized to do business therein.

(2) The solicitation of applications for such contracts.

(3) The collection of premiums, membership fees, assessments, or other consideration for such contract, or

(4) Any other transaction of insurance business.

Legislative History: [41-1206, added 1961, ch. 330, sec. 250, p. 645.]

I.C. § 41-1207: How process is served — Default judgment¶

(1) Such service of process shall be made as provided for in section 41-334 (1), and:

(a) The director shall forthwith mail by registered mail one (1) of the copies of such process to the defendant at its last known principal place of business, and shall keep a record of all processes so served upon him.

(b) Such service of process is sufficient, provided (i) notice thereof and (ii) a copy of the process, are sent to the defendant at its last known principal place of business, by the plaintiff or the plaintiff’s attorney, by registered mail within ten (10) days thereafter, and provided that on or before the date the defendant is required to appear, or within such further time as the court may allow, there shall be filed with the clerk of the court in which such action is pending (i) the defendant’s receipt of registration, or receipt issued by the post office with which the letter is registered, showing the name of the sender of the letter and the name and address of the person to whom the letter is addressed, and (ii) the affidavit of the plaintiff or plaintiff’s attorney showing a compliance herewith.

(2) Service of process in any such action, suit or proceeding shall, in addition to the manner provided in subsection (1) of this section, be valid if served upon any person within this state who, on behalf of such insurer, is:

(a) Soliciting insurance, or

(b) Making, issuing or delivering any contract of insurance, or

(c) Collecting or receiving any premium, membership fee, assessment or other consideration for insurance; and a copy of such process is sent to the defendant in the same manner as set forth in subsection (1)(b) herein.

(3) No plaintiff or complainant shall be entitled to a judgment by default under this section until the expiration of thirty (30) days from the date of the filing of the affidavit of compliance.

(4) Nothing contained in this section shall limit or abridge the right to serve any process, notice or demand upon any insurer in any other manner now or hereafter permitted by law.

Legislative History: [41-1207, added 1961, ch. 330, sec. 251, p. 645.]

I.C. § 41-1208: Defense of action by unauthorized insurer¶

(1) Before any unauthorized foreign or alien insurer shall file or cause to be filed any pleading in any action, suit or proceeding instituted against it, such unauthorized insurer shall:

(a) Deposit with the clerk of the court in which such action, suit or proceeding is pending, cash or securities, or file with such clerk a bond with good and sufficient sureties, to be approved by the court, in an amount determined by the court to be sufficient to secure the payment of any final judgment which may be rendered in such action, provided, however, that the court may in its discretion make an order dispensing with such deposit or bond where the insurer makes a showing satisfactory to such court that it maintains in a state of the United States funds or securities, in trust or otherwise, sufficient and available to satisfy any final judgment which may be entered in such action, suit or proceeding, and that such insurer will pay any final judgment rendered without requiring suit to be brought on such judgment in the state where such securities are located, or

(b) Procure a certificate of authority to transact the business of insurance in this state.

(2) In any action, suit or proceeding in which service is made in the manner provided in section 41-1207 , the court may, in its discretion, order such postponement as may be necessary to afford the defendant reasonable opportunity to comply with the provisions of subsection (1) of this section and to defend such action.

(3) Nothing in subsection (1) of this section is to be construed to prevent an unauthorized foreign or alien insurer from filing a motion, in accordance with the applicable rules of civil procedure, to quash a writ or to set aside service thereof made in the manner provided in section 41-1207 , hereof on the ground either:

(a) That such unauthorized insurer has not done any of the acts enumerated in section 41-1206 , or

(b) That the person on whom service was made pursuant to subsection (2) of section 41-1207 was not doing any of the acts therein enumerated.

Legislative History: [41-1208, added 1961, ch. 330, sec. 252, p. 645.]

I.C. § 41-1209: Unauthorized insurer failing to pay claim — Attorney fees¶

In any action against an unauthorized foreign or alien insurer, upon a contract of insurance issued or delivered in this state to a resident thereof, or to a corporation authorized to do business therein, if the insurer has failed for thirty (30) days after demand prior to the commencement of the action to make payment in accordance with the terms of the contract, and it appears to the court that such refusal was vexatious and without reasonable cause, the court may allow to the plaintiff a reasonable attorney fee and include such fee in any judgment that may be rendered in such action. Such fee shall not exceed twelve and one-half per cent (12 1/2%) of the amount which the court or jury finds the plaintiff is entitled to recover against the insurer, but in no event shall such fee be less than twenty-five dollars ($25.00). Failure of an insurer to defend any such action shall be deemed prima facie evidence that its failure to make payment was vexatious and without reasonable cause.

Legislative History: [41-1209, added 1961, ch. 330, sec. 253, p. 645.]

I.C. § 41-1210: Exemptions from Process Act¶

The provisions of this unauthorized insurers process act shall not apply to any action, suit or proceeding against any unauthorized foreign or alien insurer arising out of any contract of:

(1) Reinsurance, ocean marine, aircraft or railway insurance;

(2) Insurance effectuated in accordance with the surplus line law or any amendments or supplements thereto;

(3) Insurance against legal liability arising out of the ownership, operation or maintenance of any property having a permanent situs outside this state; or

(4) Insurance against loss of or damage to any property having a permanent situs outside this state;

Where such contract of insurance contains a provision designating the director or a bona fide resident of Idaho to be the true and lawful attorney of such unauthorized insurer upon whom may be served all lawful process in any action, suit or proceeding instituted by or on behalf of an insured or beneficiary arising out of such contract or where the insurer enters a general appearance in any such suit, action or proceeding.

Legislative History: [41-1210, added 1961, ch. 330, sec. 254, p. 645.]

I.C. § 41-1211: Surplus line law — Short title — Purpose¶

(1) Sections 41-1211 through 41-1234 , Idaho Code, constitute and may be cited as the "surplus line law."

(2) It is declared that the purposes of the surplus line law are to provide orderly access for the insuring public of Idaho to insurers not authorized to transact insurance in this state, through only qualified, licensed, and supervised surplus line brokers licensed in Idaho and under such safeguards for the insured as may be practical, for insurance coverages and to the extent thereof not procurable from authorized insurers; to protect such authorized insurers, which under the laws of Idaho must meet certain standards as to policy forms and rates, from unwarranted competition by unauthorized insurers who, in the absence of this law, would not be subject to similar requirements; and for other purposes as set forth in this law.

Legislative History: [41-1211, added 1961, ch. 330, sec. 255, p. 645; am. 1993, ch. 22, sec. 1, p. 79; am. 2002, ch. 91, sec. 1, p. 228.]

I.C. § 41-1212: Exemptions from Surplus Line Law¶

(1) The provisions of this surplus line law controlling the placing of insurance with unauthorized insurers shall not apply to reinsurance or, except as to subsection (2) below, to the following insurances when so placed by licensed agents or surplus line brokers of this state:

(a) Ocean marine and foreign trade insurances.

(b) Insurance on subjects located, resident, or to be performed wholly outside of this state, or on vehicles or aircraft owned and principally garaged outside this state.

(c) Insurance on operations of railroads engaged in transportation in interstate commerce and their property used in such operations.

(d) Insurance of aircraft owned or operated by manufacturers of aircraft, or of aircraft operated in commercial scheduled interstate flight, or cargo of such aircraft, or against liability, other than worker’s compensation and employer’s liability, arising out of the ownership, maintenance or use of such aircraft.

(2) Brokers so placing any such insurance with an unauthorized insurer shall keep a full and true record of each such coverage in detail as required of surplus line insurance under this law. The record shall be preserved for not less than five (5) years from the effective date of the insurance and shall be kept available in this state and open to the examination of the director. The broker shall furnish to the director at his request and on forms as designated and furnished by him a report of all such coverages so placed in a designated calendar year.

(3) The following sections apply only when the insured’s home state is Idaho:

(a) Section 41-1214 , Idaho Code (conditions for export);

(b) Section 41-1215 , Idaho Code (broker’s affidavit);

(c) Section 41-1216 , Idaho Code (open lines for export);

(d) Section 41-1217 , Idaho Code (eligible surplus lines insurers);

(e) Section 41-1218 , Idaho Code (eligible surplus line insurers — penalty for violation);

(f) Section 41-1219 , Idaho Code (evidence of the insurance — changes — penalty);

(g) Section 41-1220 , Idaho Code (endorsement of contract);

(h) Section 41-1227 , Idaho Code (records of broker);

(i) Section 41-1228 , Idaho Code (annual report of broker);

(j) Section 41-1229 , Idaho Code (tax on surplus lines);

(k) Section 41-1233 , Idaho Code (report and tax of independently procured coverages);

(l) Section 41-1234 , Idaho Code (records of insureds).

Legislative History: [41-1212, added 1961, ch. 330, sec. 256, p. 645; am. 1972, ch. 369, sec. 8, p. 1072; am. 2011, ch. 183, sec. 1, p. 517.]

I.C. § 41-1213: Definitions¶

As used in this chapter and any applicable rules, the following definitions shall apply:

(1) "Affiliated" means, with respect to an insured, any entity that controls, is controlled by or is under common control with the insured.

(2) "Affiliated group" means any group of entities that are all affiliated.

(3) "Broker" means a surplus line broker duly licensed as such under this chapter, including resident surplus line brokers and nonresident surplus line brokers.

(4) "Control" means:

(a) An entity directly or indirectly, or acting through one (1) or more other persons, owns or controls another entity or has the power to vote twenty-five percent (25%) or more of any class of voting securities of another entity; or

(b) An entity controls in any manner the election of a majority of the directors or trustees of another entity.

(5) (a) "Exempt commercial purchaser" means any person purchasing commercial insurance who, at the time of placement, meets the following requirements:

(i) The person employs or retains a qualified risk manager to negotiate insurance coverage.

(ii) The person has paid aggregate nationwide commercial property and casualty insurance premiums in excess of one hundred thousand dollars ($100,000) in the immediately preceding twelve (12) months.

(iii) The person meets at least one (1) of the following criteria:

1. The person possesses a net worth in excess of twenty million dollars ($20,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

2. The person generates annual revenues in excess of fifty million dollars ($50,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

3. The person employs more than five hundred (500) full-time or full-time equivalent employees per individual insured or is a member of an affiliated group employing more than one thousand (1,000) employees in the aggregate.

4. The person is a nonprofit organization or public entity generating annual budgeted expenditures of at least thirty million dollars ($30,000,000) as such amount is adjusted pursuant to the provisions of paragraph (b) of this subsection.

5. The person is a municipality with a population in excess of fifty thousand (50,000) persons.

(b) The amounts provided in subparagraph (iii)1., 2. and 4. of paragraph (a) of this subsection must be adjusted to reflect the percentage change for the five (5) year period in the consumer price index for all urban consumers published by the bureau of labor statistics of the United States department of labor.

(c) For the purposes of this subsection, "commercial insurance" means property and casualty insurance pertaining to a business, profession, occupation, nonprofit organization or public entity.

(6) "Export" means to place in an unauthorized insurer under this surplus line law insurance covering a subject of insurance resident, located, or to be performed in Idaho.

(7) (a) "Home state" means:

(i) The state in which an insured maintains its principal place of business or, in the case of an individual, the individual’s principal residence; or

(ii) If one hundred percent (100%) of the insured risk is located out of state, the state to which the greatest percentage of the insured’s taxable premium for that insurance contract is allocated.

(b) If more than one (1) insured from an affiliated group are named insureds on a single nonadmitted insurance contract, then "home state" means the home state, as determined pursuant to the provisions of paragraph (a) of this subsection, of the member of the affiliated group that has the largest percentage of premium attributed to it under such insurance contract.

(c) For the purposes of this subsection, "principal place of business" means the state where the insured maintains its headquarters and where the insured’s high level officers direct, control and coordinate the business activities of the insured.

(8) "Qualified risk manager" means, with respect to a policyholder of commercial insurance, a person who meets all of the following requirements:

(a) The person is an employee of, or a third party consultant retained by, the commercial policyholder;

(b) The person provides skilled services in loss prevention, loss reduction or risk and insurance coverage analysis, and purchase of insurance; and

(c) The person:

(i) Has at least ten (10) years of experience in risk financing, claim administration, loss prevention, risk and insurance coverage analysis or purchasing commercial lines of insurance; or

(ii) Has a graduate degree from an accredited college or university in risk management, business administration, finance, economics or any other field determined by a state insurance director or other state regulatory official or entity to demonstrate minimum competence in risk management; or

(iii) Has at least seven (7) years of experience in risk financing, claims administration, loss prevention, risk and insurance coverage analysis or purchasing commercial lines of insurance and has one (1) of the designations specified in subparagraph (iv)1. through 5. of this paragraph; or

(iv) Has a bachelor’s degree or higher education from an accredited college or university in risk management, business administration, finance, economics or any other field determined by a state insurance director or other state regulatory official or entity to demonstrate minimum competency in risk management; and either has three (3) years of experience in risk financing, claims administration, loss prevention, risk and insurance analysis or purchasing commercial lines of insurance, or has one (1) of the following designations:

1. A designation as a chartered property and casualty underwriter (CPCU) issued by the American institute for CPCU and insurance institute of America;

2. A designation as an associate in risk management (ARM) issued by the American institute for CPCU and insurance institute of America;

3. A designation as a certified risk manager (CRM) issued by the national alliance for insurance education and research;

4. A designation as a RIMS fellow (RF) issued by the global risk management institute; or

5. Any other designation, certification or license determined by a state insurance director or other state insurance regulatory official or entity to demonstrate minimum competency in risk management.

Legislative History: [41-1213, added 1961, ch. 330, sec. 257, p. 645; am. 2002, ch. 91, sec. 2, p. 228; am. 2011, ch. 183, sec. 2, p. 518.]

I.C. § 41-1214: Conditions for export¶

If certain insurance coverages cannot be procured from authorized insurers, such coverages, hereinafter designated "surplus lines," may be procured from unauthorized insurers, subject to the following conditions:

(1) The insurance must be procured through a licensed surplus line broker who is a member of a surplus line association approved by the director.

(2) The full amount or kind of insurance required must not be procurable from insurers who are authorized to do business in this state. The amount of insurance exported shall be only the excess over the amount procurable from authorized insurers unless the excess is not available without support of other coverages, provided that a diligent search is made among the insurers authorized to transact and actually writing that particular kind and class of insurance in this state.

(3) The insurance must not be so exported for the purpose of securing advantages either as to:

(a) A lower premium rate than would be accepted by an authorized insurer; or

(b) Terms of the insurance contract.

(4) A surplus line broker seeking to procure from or place insurance with an unauthorized insurer for an exempt commercial purchaser is not required to satisfy the diligent search requirement set forth in subsection (2) of this section when:

(a) The surplus line broker or referring insurance producer procuring or placing the surplus line insurance has disclosed to the exempt commercial purchaser that such insurance may or may not be available from the admitted market that may provide greater protection with more regulatory oversight; and

(b) The exempt commercial purchaser has subsequently requested in writing the surplus line broker or referring insurance producer to procure or place such insurance from an unauthorized insurer.

(5) Records of the surplus line broker’s satisfaction of the requirements of subsection (4) of this section shall be maintained in compliance with the provisions of section 41-1227 , Idaho Code.

(6) A surplus line broker may not knowingly place surplus line insurance with insurers that are financially unsound. The surplus line broker may only so insure with the following:

(a) Any foreign insurer that is authorized to write the kind of insurance in its domiciliary jurisdiction and has capital and surplus or its equivalent under the laws of its domiciliary jurisdiction that equals the greater of the following: (i) the minimum capital and surplus requirements under the laws of this state; or (ii) fifteen million dollars ($15,000,000); or

(b) Any alien insurer that is listed on the quarterly listing of alien insurers maintained by the international insurers department of the national association of insurance commissioners.

(7) The requirements in paragraph (a) of subsection (6) of this section may be satisfied by an insurer that possesses less than the minimum capital and surplus upon an affirmative finding of acceptability by the director. Such finding shall be based upon factors such as quality of management, capital and surplus of any parent company, company underwriting profit and investment income trends, market availability and company record and reputation within the industry. The director is prohibited from making an affirmative finding of acceptability when the foreign insurer’s capital and surplus is less than four million five hundred thousand dollars ($4,500,000).

(8) The director may promulgate rules to prescribe the terms under which the financial requirements provided in this section may be waived in circumstances where insurance cannot be otherwise procured on risks located in this state.

(9) For any violation of the provisions of this section, a surplus line broker may be subject to a fine of not less than one hundred dollars ($100) and not more than five thousand dollars ($5,000), or the surplus line broker’s license may be revoked, suspended or nonrenewed, or both such fine and license revocation, suspension or nonrenewal.

Legislative History: [41-1214, added 1961, ch. 330, sec. 258, p. 645; am. 1993, ch. 22, sec. 2, p. 80; am. 2011, ch. 183, sec. 3, p. 520.]

I.C. § 41-1215: Broker’s affidavit¶

At the time of procuring any such surplus line insurance the broker shall execute an affidavit, in form as prescribed or accepted by the director, setting forth facts from which it can be determined whether such insurance was eligible for export under section 41-1214 , Idaho Code. The broker shall file, or cause to be filed, this affidavit with the director within thirty (30) days after the insurance policy is received by the broker.

Legislative History: [41-1215, added 1961, ch. 330, sec. 259, p. 645; am. 1993, ch. 22, sec. 3, p. 80; am. 2002, ch. 91, sec. 3, p. 228.]

I.C. § 41-1216: Open lines for export¶

(1) The director may by order or by rule declare eligible for export generally and without compliance with the provisions of sections 41-1214 (2), 41-1214 (3) and 41-1215 , Idaho Code, any class or classes of insurance coverage or risk which he finds, consistent with the procedural requirements of chapter 52, title 67 , Idaho Code, that there is no reasonable or adequate market among authorized insurers either as to acceptance of the risk, contract terms, or premium or premium rate. Any such order shall continue in effect during the existence of the conditions upon which predicated, but subject to earlier termination by the director.

(2) The broker shall file with or as directed by the director a memorandum as to each such coverage placed by him in an unauthorized insurer, in such form and context as the director may reasonably require for the identification of the coverage and determination of the tax payable to the state relative thereto.

(3) The broker, or a licensed Idaho agent of the authorized insurer, may also place with authorized insurers any insurance coverage made eligible for export generally under subsection (1) of this section and without regard to rate or form filings which may otherwise be applicable as to the authorized insurer. As to coverages so placed in an authorized insurer the premium tax thereon shall be reported and paid by the insurer as required generally under section 41-402 , Idaho Code.

Legislative History: [41-1216, added 1961, ch. 330, sec. 260, p. 645; am. 2002, ch. 91, sec. 4, p. 228.]

I.C. § 41-1217: Eligible surplus lines insurers¶

(1) A broker shall not knowingly place surplus lines insurance with an insurer that is unsound financially, or that is ineligible under this section.

(2) The director shall from time to time compile or approve a list of all surplus lines insurers deemed by him to be eligible currently, and shall cause to be sent a copy of such list to each broker at his office last of record with the director. This subsection shall not be deemed to require the director to determine the actual financial condition or claims practices of any unauthorized insurer; and the status of eligibility, if granted by the director, shall indicate only that the insurer appears to be sound financially and to have satisfactory claims practices, and that the director has no credible evidence to the contrary. While any such list is in effect the broker shall restrict to the insurers so listed all surplus lines business placed by him and a person who independently procures its own insurance pursuant to this chapter for risks located in Idaho shall only purchase surplus line insurance from insurers so listed.

(3) An eligible surplus lines insurer shall notify the director of any change to the name of the insurer, its physical or mailing address, or its state of domicile, within sixty (60) days of such change.

Legislative History: [41-1217, added 1961, ch. 330, sec. 261, p. 645; am. 1969, ch. 214, sec. 39, p. 625; am. 1997, ch. 108, sec. 1, p. 252; am. 2002, ch. 91, sec. 5, p. 229; am. 2004, ch. 87, sec. 1, p. 322.]

I.C. § 41-1218: Eligible surplus line insurers — Penalty for violation¶

(1) For any violation of section 41-1217 , Idaho Code, the broker or a person who independently procures its own insurance shall, upon conviction thereof, be guilty of a misdemeanor punishable as provided in section 41-117 , Idaho Code (general penalty).

(2) The director may impose an administrative penalty not to exceed fifteen thousand dollars ($15,000), for deposit in the general account of the state of Idaho, upon any person or entity who transacts or who attempts to transact insurance as a surplus lines insurer in violation of any provision of chapter 12, title 41 , Idaho Code. Failure of any such person or entity to pay a fine imposed pursuant to the provisions of this section shall authorize the director to seek enforcement of the fine, and any associated costs and attorney’s fees related to bringing the action, in any district court of this state.

Legislative History: [41-1218, added 1961, ch. 330, sec. 262, p. 645; am. 1993, ch. 22, sec. 4, p. 81; am. 2002, ch. 91, sec. 6, p. 229; am. 2005, ch. 267, sec. 1, p. 828.]

I.C. § 41-1219: Evidence of the insurance — Changes — Penalty¶

(1) Upon placing a surplus line coverage, the broker shall promptly issue and deliver to the insured evidence of the insurance consisting either of the policy as issued by the insurer or, if such policy is not then available, a certificate showing the description and location of the subject of the insurance, coverage, conditions and term of the insurance, the premium and rate charged and taxes collected from the insured, and the name and address of the insured and insurer. If the direct risk is assumed by more than one insurer, the certificate shall state the name and address and proportion of the entire direct risk assumed by each such insurer.

(2) No broker shall issue any such certificate or any cover note, or purport to insure or represent that insurance will be or has been granted by any unauthorized insurer, unless he has prior written authority from the insurer for the insurance, or has received information from the insurer in the regular course of business that such insurance has been granted, or an insurance policy providing the insurance actually has been issued by the insurer and delivered to the insured.

(3) If after the issuance and delivery of any such certificate there is any change as to the identity of the insurers, or the proportion of the direct risk assumed by an insurer as stated in the broker’s original certificate, or in any other material respect as to the insurance coverage evidenced by the certificate, the broker shall promptly issue and deliver to the insured a substitute certificate accurately showing the current status of the coverage and the insurers responsible thereunder.

(4) If a policy issued by the insurer is not available upon placement of the insurance and the broker has issued and delivered his certificate as hereinabove provided, upon request therefor by the insured the broker shall as soon as reasonably possible procure from the insurer its policy evidencing such insurance and deliver such policy to the insured in replacement of the broker’s certificate theretofore issued.

(5) Any surplus line broker who knowingly issues a false certificate of insurance, or who knowingly fails promptly to notify the insured of any material change with respect to such insurance by delivery to the insured of a substitute certificate as provided in subsection (3) of this section, shall upon conviction, be subject to the penalties provided by section 41-117 , Idaho Code, or to any greater applicable penalty otherwise provided by law.

Legislative History: [41-1219, added 1961, ch. 330, sec. 263, p. 645; am. 1997, ch. 108, sec. 2, p. 253.]

I.C. § 41-1220: Endorsement of contract¶

Every insurance contract procured and delivered as a surplus lines coverage pursuant to this law shall have stamped upon it, either in red ink with at least ten (10) point bold print or in black ink with at least twelve (12) point bold print, and bear the name of the surplus lines broker who procured it, the following:

"This surplus line contract is issued pursuant to the Idaho insurance laws by an insurer not licensed by the Idaho Department of Insurance. There is no coverage provided for surplus line insurance by either the Idaho Insurance Guaranty Association or by the Idaho Life and Health Insurance Guaranty Association."

Legislative History: [41-1220, added 1961, ch. 330, sec. 264, p. 645; am. 1969, ch. 214, sec. 40, p. 625; am. 1993, ch. 22, sec. 5, p. 81; am. 2010, ch. 164, sec. 1, p. 338.]

I.C. § 41-1221: Surplus line insurance valid¶

Insurance contracts procured as surplus line coverage from unauthorized insurers in accordance with this law shall be fully valid and enforceable as to all parties, and shall be given recognition in all matters and respects to the same effect as like contracts issued by authorized insurers.

Legislative History: [41-1221, added 1961, ch. 330, sec. 265, p. 645.]

I.C. § 41-1222: Liability of insurer as to losses and unearned premiums¶

(1) As to a surplus line risk which has been assumed by an unauthorized insurer pursuant to this surplus line insurance law, and if the premium thereon has been received by the surplus line broker who placed such insurance, in all questions thereafter arising under the coverage as between the insurer and the insured the insurer shall be deemed to have received the premium due to it for such coverage; and the insurer shall be liable to the insured as to losses covered by such insurance, and for unearned premiums which may become payable to the insured upon cancelation of such insurance, whether or not in fact the broker is indebted to the insurer with respect to such insurance or for any other cause.

(2) Each unauthorized insurer assuming a surplus line direct risk under this surplus lines insurance law shall be deemed thereby to have subjected itself to the terms of this section.

Legislative History: [41-1222, added 1961, ch. 330, sec. 266, p. 645.]

I.C. § 41-1223: Licensing of surplus line brokers¶

(1) Any individual while licensed as a producer licensed for property or casualty insurance who has had at least two (2) years’ experience as a producer for the lines of insurance for which he is seeking to be licensed as a surplus line broker, and who is deemed by the director to be competent and trustworthy with respect to the handling of surplus lines, may be licensed as a surplus line broker.

(2) Application for the license shall be made to the director on forms as designated and furnished by the director.

(3) The license and continuation fee shall be as set forth by rule pursuant to section 41-401 , Idaho Code.

(4) The license and licensee shall be subject to the applicable provisions of chapter 10, title 41 , Idaho Code (producer licensing).

(5) When a national insurance producer database of the national association of insurance commissioners, or other equivalent uniform national database, for the licensure of surplus line brokers is created, the director may participate in such database.

Legislative History: [41-1223, added 1961, ch. 330, sec. 267, p. 645; am. 1972, ch. 164, sec. 3, p. 376; am. 1976, ch. 118, sec. 3, p. 458; am. 2001, ch. 296, sec. 5, p. 1063; am. 2002, ch. 91, sec. 7, p. 230; am. 2011, ch. 183, sec. 4, p. 521.]

I.C. § 41-1224: Suspension or revocation of broker’s license¶

(1) The director may suspend or revoke any surplus line broker’s license:

(a) If the broker fails to file his annual report or to remit the tax as required by this law; or

(b) If the broker fails to keep the records, or to allow the director to examine his records in this state as required by this law; or

(c) If the broker knowingly places a surplus line coverage in an insurer that is in unsound financial condition in violation of section 41-1217 , Idaho Code; or

(d) For any other applicable cause for which a producer’s license may be suspended or revoked.

(2) The procedures provided by chapter 10, title 41 , Idaho Code, for suspension or revocation of licenses shall apply to suspension or revocation of a surplus line broker’s license.

(3) Upon suspending or revoking the broker’s surplus line license the director shall also suspend or revoke all other licenses of the same individual under this code.

(4) No broker whose license has been so suspended or revoked shall again be so licensed until any fines or delinquent taxes owing by him have been paid, nor, in case of revocation, until after expiration of one (1) year from date revocation became final.

Legislative History: [41-1224, added 1961, ch. 330, sec. 268, p. 645; am. 1972, ch. 164, sec. 4, p. 376; am. 1997, ch. 108, sec. 3, p. 254; am. 2002, ch. 91, sec. 8, p. 230.]

I.C. § 41-1226: Acceptance of business from agents¶

A licensed surplus line broker may accept and place surplus line business for any insurance agent licensed in this state for the kind of insurance involved, and may compensate the agent therefor.

Legislative History: [41-1226, added 1961, ch. 330, sec. 270, p. 645.]

I.C. § 41-1227: Records of broker¶

(1) Each broker shall keep in his office a full and true record of each surplus line coverage procured by him, including a copy of each daily report, if any, a copy of each certificate of insurance issued by him, and such of the following items as may be applicable:

(a) Amount of the insurance;

(b) Gross premium charged;

(c) Return premium paid, if any;

(d) Rate of premium charged upon the several items of property;

(e) Effective date of the contract, and the terms thereof;

(f) Name and address of each insurer on the direct risk and the proportion of the entire risk assumed by such insurer if less than the entire risk;

(g) Name and address of the insured;

(h) Brief general description of the property of risk injured and where located or to be performed; and

(i) Other information as may be required by the director.

(2) The record shall at all times within five (5) years after issuance of the coverage to which it relates be open to examination in this state by the director.

Legislative History: [41-1227, added 1961, ch. 330, sec. 271, p. 645; am. 2002, ch. 91, sec. 10, p. 231.]

I.C. § 41-1228: Annual report of broker¶

(1) Each broker shall on or before the first day of March of each year file with the director a verified report of all surplus line insurance transacted by him during the preceding calendar year.

(2) The statement shall be on forms as prescribed and furnished by the director and shall show:

(a) Gross amount of each kind of insurance transacted;

(b) Aggregate gross premiums charged;

(c) Aggregate of returned premiums paid to insureds;

(d) Aggregate of net premiums; and

(e) Additional information as required by the director.

Legislative History: [41-1228, added 1961, ch. 330, sec. 272, p. 645; am. 2002, ch. 91, sec. 11, p. 231.]

I.C. § 41-1229: Tax on surplus lines¶

(1) On or before the first day of March of each year, each broker shall remit to the director a tax on the premiums, exclusive of sums collected to cover federal and state taxes and examination fees, on surplus line insurance subject to tax transacted by him with unauthorized insurers during the preceding calendar year as shown by his annual statement filed with the director, and at the rate of one and five-tenths percent (1.5%). Such tax shall be in lieu of all other taxes upon such insurers with respect to the business so reported.

(2) For property and casualty insurance other than worker’s compensation insurance, if Idaho is the insured’s home state, then the tax so payable shall be computed upon the entire premium under subsection (1) of this section, without regard to whether the policy covers risks or exposures that are located in Idaho. For all other lines of insurance, if a surplus line policy covers risks or exposures only partially in Idaho, the tax so payable shall be computed upon the proportion of the premium that is properly allocable to the risks or exposures located in Idaho.

(3) Each broker shall round to the nearest whole dollar any amount shown or required to be shown on any return, form, statement, or other document submitted to the director or to any entity set forth in rule pursuant to section 41-1232 , Idaho Code. Any record or other document prepared or maintained by the director shall express any dollar amount rounded to the nearest whole dollar.

Legislative History: [41-1229, added 1961, ch. 330, sec. 273, p. 645; am. 1988, ch. 186, sec. 1, p. 325; am. 1988, ch. 366, sec. 4, p. 1079; am. 1994, ch. 383, sec. 3, p. 1232; am. 2004, ch. 387, sec. 1, p. 1163; am. 2011, ch. 183, sec. 5, p. 521; am. 2019, ch. 45, sec. 2, p. 125.]

I.C. § 41-1230: Failure to file report or remit tax — Penalty¶

If any broker fails to file his annual report, or fails to remit the tax provided by section 41-1229 , Idaho Code, prior to the first day of April after the tax is due, he shall be liable for a fine of twenty-five dollars ($25.00) for each day of delinquency commencing with the first day of April. The tax may be collected by distraint, or the tax and fine may be recovered by an action instituted by the director in any court of competent jurisdiction. Any fine collected by the director shall be paid to the state treasurer and credited to the general fund.

Legislative History: [41-1230, added 1961, ch. 330, sec. 274, p. 645; am. 2002, ch. 91, sec. 12, p. 231.]

I.C. § 41-1231: Legal process against surplus line insurer¶

(1) An unauthorized insurer shall be sued, upon any cause of action arising in this state under any contract issued by it as a surplus line contract pursuant to this law, in the district court of the county in which the cause of action arose.

(2) Service of legal process against the insurer may be made in any such action by service upon the director as provided in section 41-334 (1). The director shall forthwith mail a copy of the process served to the person designated by the insurer in the policy for the purpose, by prepaid registered mail with return receipt requested. The insurer shall have thirty (30) days from the date of service upon the director within which to plead, answer, or otherwise defend the action. Upon service of process upon the director in accordance with this provision, the court shall be deemed to have jurisdiction in personam of the insurer.

(3) An unauthorized insurer issuing such policy shall be deemed thereby to have authorized service of process against it in the manner and to the effect as provided in this section. Any such policy shall contain a provision stating the substance of this section, and designating the person to whom the director shall mail process as provided in subsection (2) of this section.

Legislative History: [41-1231, added 1961, ch. 330, sec. 275, p. 645.]

I.C. § 41-1232: Rules and regulations¶

(1) The director shall make or may approve and adopt reasonable rules and regulations, consistent with this surplus lines law, for any or all of the following purposes:

(a) Effectuation of such law;

(b) Establishment of procedures through which determination is to be made as to the eligibility of particular proposed coverages for export; and

(c) Establishment, procedures, and operations of any organization of brokers or others designed to assist such brokers to comply with such law. The director may delegate to such an organization the responsibility, under his general supervision, for the determination of the eligibility for export of particular proposed coverages; and

(d) Regulation of the fees and charges to be required of the insured in addition to the premium as fixed by the insurer.

(2) Such rules and regulations shall be subject to the procedures and carry the penalty provided by section 41-211 , Idaho Code, (rules and regulations).

Legislative History: [41-1232, added 1961, ch. 330, sec. 276, p. 645; am. 1969, ch. 214, sec. 41, p. 625; am. 1993, ch. 22, sec. 6, p. 81.]

I.C. § 41-1233: Report and tax of independently procured coverages¶

(1) Every insured who in this state procures or causes to be procured or continues or renews insurance in an unauthorized foreign insurer, or any self-insurer who in this state so procures or continues excess loss, catastrophe or other insurance, upon a subject of insurance resident, located or to be performed within this state, other than insurance procured through a surplus line broker pursuant to the surplus line law of this state or exempted from tax pursuant to section 41-1212 , Idaho Code, shall within thirty (30) days after the date such insurance policy was so received by the insured, continued or renewed file a written report of the same with the surplus line association on forms designated by the director and furnished to the insured upon request. The report shall show the name and address of the insured or insureds, name and address of the insurer, the subject of the insurance, a general description of the coverage, the amount of premium currently charged therefor, and such additional pertinent information as the director reasonably requests. If the insurance covers also a subject of insurance resident, located or to be performed outside this state, a proper pro rata portion of the entire premium payable for all such insurance shall be allocated to this state for the purposes of this section.

(2) Any insurance in an unauthorized insurer procured through negotiations or an application in whole or in part occurring or made within or from within this state, or for which premiums in whole or in part are remitted directly or indirectly from within this state, shall be deemed to be insurance procured or continued or renewed in this state within the intent of subsection (1) of this section.

(3) The insured with respect to the obligation, chose in action, or right represented by such insurance shall be subject to section 41-1229 , Idaho Code, as it pertains to premium tax. Within thirty (30) days after the insurance policy was so received by the insured, continued or renewed, and coincidentally with the filing with the surplus line association of the report provided for in subsection (1) of this section, the insured shall pay the amount of the tax to the director and a stamping fee to the surplus line association.

(4) The tax shall be collectible from the insured by civil action brought by the director, or by distraint.

(5) This section does not abrogate or modify any provision of section 41-1201 (representing or aiding unauthorized insurer prohibited), 41-1202 (representing or aiding unauthorized insurer prohibited — penalty), or 41-1203 (suits by unauthorized insurer prohibited), Idaho Code.

(6) This section does not apply as to life or disability insurances.

Legislative History: [41-1233, added 1961, ch. 330, sec. 277, p. 645; am. 1988, ch. 366, sec. 5, p. 1080; am. 1993, ch. 22, sec. 7, p. 82; am. 2002, ch. 91, sec. 13, p. 232; am. 2004, ch. 387, sec. 2, p. 1164; am. 2021, ch. 42, sec. 2, p. 124.]

I.C. § 41-1234: Records of insureds¶

In order that the director may effectively administer the various provisions of this chapter, every person as to whom insurance has been placed with an unauthorized insurer shall, upon the director’s order, produce for his examination all policies and other documents evidencing the insurance, and shall disclose to the director the amount of premiums paid or agreed to be paid for the insurance. For each refusal to obey such order such person shall, upon conviction thereof, be guilty of a misdemeanor punishable by a fine of not more than five hundred dollars ($500).

Legislative History: [41-1234, added 1961, ch. 330, sec. 278, p. 645.]

I.C. § 41-1235: False advertising act¶

Sections 41-1235 through 41-1237 of this act constitute and may be referred to as the unauthorized insurers false advertising process act.

Legislative History: [I.C., sec. 41-1235, as added by 1969, ch. 214, sec. 42, p. 625.]

I.C. § 41-1236: Misrepresentation by unauthorized insurer¶

No unauthorized insurer through any estimate, illustration, circular, pamphlet, letter, announcement, statement or any other means or medium shall misrepresent to any person in this state its financial condition or the terms of any contract issued or to be issued by it or the advantages thereof, or the dividends or share to be received thereon. Whenever the director has reason to believe that any such insurer is so misrepresenting, he shall notify the insurer and the insurance supervisory officer of the insurer’s domiciliary state or province by registered or certified mail.

Legislative History: [I.C., sec. 41-1236, as added by 1969, ch. 214, sec. 43, p. 625.]

I.C. § 41-1237: Misrepresentation — Action and penalties¶

(1) If within twenty-one (21) days following the giving of the notice provided for in section 41-1236 , Idaho Code, the insurer has not ceased such dissemination, and if the director has reason to believe that such insurer is soliciting, issuing or delivering contracts of insurance to residents of this state or collecting premiums on such contracts or performing any other transaction in connection with such insurance, and that a proceeding by him in respect to such matters would be in the interest of the public, he shall order the insurer to desist the prohibited practices.

(2) If the director finds that the insurer has misrepresented as referred to in section 41-1236 , Idaho Code, he shall by order on such hearing require the insurer to cease and desist from such violation, and shall mail a copy of the order by registered or certified mail to the insurer at its principal place of business last of record with the director and to the insurance supervisory officer of the insurer’s domiciliary state or province. Each violation thereafter of such desist order shall subject the insurer to a penalty of two thousand dollars ($2,000), to be recovered by a civil action brought against the insurer by the director. Service of process upon the insurer in such action may be made upon the director pursuant to section 41-1207 , Idaho Code, or in any other lawful manner.

Legislative History: [41-1237, added 1969, ch. 214, sec. 44, p. 625; am. 2005, ch. 78, sec. 2, p. 272.]

Chapter 15¶

I.C. § 41-1501: Short title¶

This chapter will be known and may be cited as the "Managing General Agents Act."

Legislative History: [41-1501, added 1991, ch. 293, sec. 1, p. 754.]

I.C. § 41-1502: Definitions¶

For the purposes of this chapter:

(1) "Actuary" means a person who is a member in good standing of the American academy of actuaries.

(2) "Insurer" means any person, firm, association or corporation duly licensed in this state as an insurance company pursuant to and acting consistent with the definitions provided in sections 41-103 and 41-112 , Idaho Code.

(3) "Managing general agent" (MGA) means any person, firm, association or corporation who negotiates and binds ceding reinsurance contracts on behalf of an insurer or manages all or part of the insurance business of an insurer (including the management of a separate division, department or underwriting office) and acts as an agent for such insurer whether known as a managing general agent, manager or other similar term, who, with or without the authority, either separately or together with affiliates, produces, directly or indirectly, and underwrites an amount of gross direct written premium equal to or more than five per cent (5%) of the policyholder surplus as reported in the last annual statement of the insurer in any one (1) quarter or year together with one (1) or more of the following:

(a) Adjusts or pays claims in excess of an amount determined by the director, or

(b) Negotiates reinsurance on behalf of the insurer.

(4) Notwithstanding the above definition of MGA, the following persons shall not be considered as MGAs for the purposes of this chapter:

(a) An employee of the insurer;

(b) An United States manager of the United States branch of an alien insurer;

(c) An underwriting manager which, pursuant to contract, manages the insurance operations of the insurer, is under common control with the insurer, subject to the holding company regulatory act, and whose compensation is not based on the volume of premiums written;

(d) The attorney-in-fact authorized by and acting for the subscribers of a reciprocal insurer or interinsurance exchange under powers of attorney.

(5) "Underwrite" means the authority to accept or reject risks on behalf of the insurer.

Legislative History: [41-1502, added 1991, ch. 293, sec. 1, p. 754.]

I.C. § 41-1503: Licensure¶

(1) No person, firm, association or corporation shall act in the capacity of a MGA with respect to risks located in this state for an insurer licensed in this state unless such person is a licensed agent in this state pursuant to the provisions of chapter 10, title 41 , Idaho Code.

(2) No person, firm, association or corporation shall act in the capacity of a MGA representing an insurer domiciled in this state with respect to risks located outside this state unless such person is licensed as an agent in this state pursuant to the provisions of chapter 10, title 41 , Idaho Code.

(3) Every MGA as defined in section 41-1502 (3), Idaho Code, shall be required to be bonded. The bond shall be in favor of the state to be held in trust for the benefit and protection of insureds and insurers whose money the MGA handles. The amount of the bond shall not be less than ten per cent (10%) of the amount of total funds handled, except that in no case shall such bond be less than five thousand dollars ($5,000). For purposes of fixing the amount of such bond, the amount of funds handled shall be determined by the total funds handled by the MGA in the preceding year, or if no funds were handled during the preceding year, the amount of funds reasonably estimated to be handled during the current calendar year by the MGA. Only one (1) such bond shall be required of the MGA for all insurers which utilize the services of the MGA, unless provided otherwise in the written agreement between the insurer and the MGA or otherwise required by the director.

(4) The director may require the MGA to maintain an errors and omissions policy.

Legislative History: [41-1503, added 1991, ch. 293, sec. 1, p. 755.]

I.C. § 41-1504: Required contract provisions¶

No person, firm, association or corporation acting in the capacity of a MGA shall place business with an insurer unless there is in force a written contract between the parties which sets forth the responsibilities of each party and where both parties share responsibility for a particular function, specifies the division of such responsibilities, and which contains the following minimum provisions:

(1) The insurer may terminate the contract for cause upon written notice to the MGA. The insurer may suspend the underwriting authority of the MGA during the pendency of any dispute regarding the cause for termination.

(2) The MGA will render accounts to the insurer detailing all transactions and remit all funds due under the contract to the insurer on not less than a monthly basis.

(3) All funds collected for the account of an insurer will be held by the MGA in a fiduciary capacity in a bank which is a member of the federal reserve system. This account shall be used for all payments on behalf of the insurer. The MGA may retain no more than three (3) months estimated claims payments and allocated loss adjustment expenses.

(4) Separate records of business written by the MGA will be maintained. The insurer shall have access and right to copy all accounts and records related to its business in a form usable by the insurer and the director shall have access to all books, bank accounts and records of the MGA in a form usable to the director. Such records shall be retained for a minimum period of six (6) years.

(5) The contract may not be assigned in whole or part by the MGA.

(6) Appropriate underwriting guidelines including:

(a) The maximum annual premium volume;

(b) The basis of the rates to be charged;

(c) The types of risks which may be written;

(d) Maximum limits of liability;

(e) Applicable exclusions;

(f) Territorial limitations;

(g) Policy cancellation provisions; and

(h) The maximum policy period.

Any cancellation or nonrenewal of any policy of insurance is subject to all applicable laws and regulations concerning the cancellation and nonrenewal of insurance policies.

(7) If the contract permits the MGA to settle claims on behalf of the insurer:

(a) All claims must be reported to the company in a timely manner.

(b) A copy of the claim file will be sent to the insurer at its request or as soon as it becomes known that the claim:

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

(ii) Involves a coverage dispute;

(iii) May exceed the MGA’s claims settlement authority;

(iv) Is open for more than six (6) months; or

(v) Is closed by payment of an amount set by the director or an amount set by the company, whichever is less.

(c) All claims files will be the joint property of the insurer and MGA. However, upon an order of liquidation of the insurer such files shall become the sole property of the insurer or its estates. The MGA shall have reasonable access to and the right to copy the files on a timely basis.

(d) Any settlement authority granted to the MGA may be terminated for cause upon the insurer’s written notice to the MGA or upon the termination of the contract. The insurer may suspend the settlement authority during the pendency of any dispute regarding the cause for termination.

(8) Where electronic claims files are in existence, the contract must address the timely transmission of the data.

(9) If the contract provides for a sharing of interim profits by the MGA, and the MGA has the authority to determine the amount of the interim profits by establishing loss reserves or controlling claim payments, or in any other manner, interim profits will not be paid to the MGA until one (1) year after they are earned for property insurance business and five (5) years after they are earned on casualty business and not until the profits have been verified pursuant to section 41-1505 , Idaho Code.

(10) The MGA shall not:

(a) Bind reinsurance or retrocessions on behalf of the insurer, except that the MGA may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers with whom such automatic agreements are in effect, the coverages and amounts of percentages that may be reinsured and commission schedules;

(b) Commit the insurer to participate in insurance or reinsurance syndicates;

(c) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of insurance for which he is appointed;

(d) Without prior approval of the insurer, pay or commit the insurer to pay a claim over a specified amount, net of reinsurance, which shall not exceed one percent (1%) of the insurer’s policyholders surplus as of December 31 of the last completed calendar year;

(e) Collect any payment from a reinsurer or commit the insurer to any claims settlement with a reinsurer without prior approval of the insurer. If prior approval is given, a report must be promptly forwarded to the insurer;

(f) Permit its subagent to serve on the insurer’s board of directors;

(g) Jointly employ an individual who is employed with the insurer; or

(h) Appoint a sub-MGA.

Legislative History: [41-1504, added 1991, ch. 293, sec. 1, p. 756.]

I.C. § 41-1505: Duties of insurers¶

(1) The insurer shall have on file an independent financial examination, in a form acceptable to the director, of each MGA with whom it has done business.

(2) If a MGA establishes loss reserves, the insurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the MGA. This is in addition to any other required loss reserve certification.

(3) The insurer shall conduct an on-site review of the underwriting and claims processing operations of the MGA on a semiannual or more frequent basis.

(4) Binding authority for all reinsurance contracts or participation in insurance or reinsurance syndicates shall rest with an officer of the insurer, who shall not be affiliated with the MGA.

(5) Within thirty (30) days of entering into or termination of a contract with a MGA, the insurer shall provide written notification of such appointment or termination to the director. Notices of appointment of a MGA shall include:

(a) A statement of duties which the applicant is expected to perform on behalf of the insurer;

(b) The lines of insurance for which the applicant is to be authorized to act; and

(c) Any other information the director may request.

(6) An insurer shall review its books and records each quarter to determine if any agent has become, by operation of the provisions of section 41-1502 (3) and (4), Idaho Code, a MGA as defined in that section. If the insurer determines that an agent has become a MGA pursuant to the above, the insurer shall promptly notify the agent and the director of such determination and the insurer and agent must fully comply with the provisions of this chapter within thirty (30) days.

(7) An insurer shall not appoint to its board of directors an officer, director, employee, agent or controlling shareholder of its MGA. The provisions of this subsection shall not apply to relationships governed by chapter 38, title 41 , Idaho Code.

Legislative History: [41-1505, added 1991, ch. 293, sec. 1, p. 757.]

I.C. § 41-1506: Examination authority¶

The acts of the MGA are considered to be the acts of the insurer on whose behalf it is acting. A MGA may be examined pursuant to the insurance statutes and regulations as if it were the insurer.

Legislative History: [41-1506, added 1991, ch. 293, sec. 1, p. 758.]

I.C. § 41-1507: Penalties and liabilities¶

(1) If the director finds, after a hearing conducted in accordance with the insurance code and the regulations and procedures adopted by the Idaho department of insurance, that any person, firm, association or corporation has violated any provision of this chapter, the director may order:

(a) For each separate violation, a penalty in an amount not to exceed ten thousand dollars ($10,000);

(b) Revocation or suspension of the agent’s license; and

(c) The MGA to reimburse the insurer, the rehabilitator or liquidator of the insurer for any losses incurred by the insurer caused by a violation of the provisions of this chapter committed by the MGA.

(2) Nothing contained in this section shall affect the right of the director to impose any other penalties provided for in the insurance statutes.

(3) Nothing contained in this chapter is intended to or shall in any manner limit or restrict the rights of policyholders, claimants and auditors.

Legislative History: [41-1507, added 1991, ch. 293, sec. 1, p. 758.]

Chapter 27¶

I.C. § 41-2701: Scope of chapter¶

This chapter applies only as to title insurance, as defined in section 41-508 .

Legislative History: [41-2701, added 1961, ch. 330, sec. 566, p. 645.]

I.C. § 41-2702: Countersignature of policies¶

A title insurer shall not issue a policy of title insurance or guaranteed certificate of title or other guaranty of title covering any property located within Idaho unless countersigned by a person, partnership, corporation or agency owning and maintaining a complete set of tract indexes or abstract records of the county in which such property is located; excepting, that any title insurer may issue such policies, guaranties or certificates directly and without such countersignature covering property in any county where it owns and maintains such indexes and records, or where no such indexes and records are owned and maintained.

Legislative History: [41-2702, added 1961, ch. 330, sec. 567, p. 645.]

I.C. § 41-2703: Other provisions especially applicable¶

The following other provisions of this code are, among other provisions, especially applicable as to title insurers:

(1) Insuring powers, sections 41-312 (3) and 41-508 .

(2) Capital funds required, section 41-313 .

(3) Deposit of title insurer, sections 41-316 and 41-316A .

(4) Premium tax, section 41-402 .

(5) Definition of "title insurance", section 41-508 .

(6) Reserve for losses, unearned premiums, section 41-611 .

(7) Special investments by title insurer, section 41-726 .

(8) Levy upon deposit of the insurer, section 41-810 .

Legislative History: [41-2703, added 1961, ch. 330, sec. 568, p. 645; am. 1994, ch. 240, sec. 11, p. 758.]

I.C. § 41-2704: Application of act — Business of title insurance¶

The provisions of chapter 27, title 41 , Idaho Code, shall apply to all title insurance companies, title insurance rating organizations, title insurance agents, applicants for title insurance, policyholders and to all persons and business entities engaged in the business of title insurance. The business of title insurance shall include:

(1) The making, or proposing to make, as an insurer, guarantor or surety, or proposing any contract or policy of title insurance, which shall include all certificates, policies, binders, preliminary reports or other underwriting contracts and indorsements;

(2) Transacting or proposing to transact any phase of title insurance including solicitations, negotiations preliminary to and execution of a contract of title insurance, and matters subsequent to the issuance of such contract;

(3) The performance of any act included herein by a title insurer or a title insurance agent including, but not limited to, handling of escrows, settlements or closing incident to any contract or policy of title insurance;

(4) The issuance of closing or settlement protection by a title insurer pursuant to section 41-2714 , Idaho Code; or

(5) The doing, or proposing to do, any business in substance equivalent to any of the foregoing in the manner designated to evade the provisions of this chapter.

Legislative History: [41-2704, added 1973, ch. 135, sec. 1, p. 252; am. 2015, ch. 275, sec. 1, p. 1132.]

I.C. § 41-2705: Supervision — Policy forms — Premiums¶

(1) The business of title insurance shall operate in Idaho under the control and supervision of the director of the department of insurance as to the premium rates for basic classifications of policy and underwriting contracts in relation thereto, escrow fee, rates, closing or settlement protection, tract indexes and abstract records, and insurability as provided in title 41 , Idaho Code, and under such uniform rules and regulations as may be from time to time prescribed by the director of the department of insurance. No title insurer shall engage in the title insurance business with respect to any interest in Idaho property other than under the applicable laws of the state of Idaho and under such rules and regulations as may be issued by the director of the department of insurance. No policy of title insurance or guarantee of any character on Idaho property shall be issued unless written by a title insurer complying with all the provisions of the laws of the state of Idaho, holding a certificate of authority under chapter 3, title 41 , Idaho Code, and under such rules and regulations as may be issued by the director of the department of insurance.

(2) The rates for the premiums for title insurance and closing or settlement protection, the proportion of the rates for the premiums for title insurance and closing or settlement protection which is retained by a title insurance agent and the portion which is retained by a title insurer, shall be determined within the provisions of sections 41-2706 , 41-2707 and 41-2708 , Idaho Code, and the general provisions of title 41 , Idaho Code; provided, not later than the effective date hereof each title insurer shall file its premium rates and basic policy classification in relation thereto, and the said rate so filed shall continue until changed as herein provided.

(3) The escrow fees of title insurers and title insurance agents shall be filed in accordance with rules promulgated by the director of the department of insurance.

(4) A title insurer shall file each form of certificate, policy, preliminary report, binder, closing or settlement protection, guaranty or other underwriting contract of title insurance prior to the delivery or issuance thereof in Idaho. The filing of the form of policies and contracts of title insurance and the approval of the same shall be in accordance with sections 41-1812 and 41-1813 , Idaho Code, as well as in conformance with chapter 27, title 41 , Idaho Code.

(5) The provisions of sections 41-2705 through 41-2708 , Idaho Code, shall not apply to a title insurer contracting as a reinsurer of a title insurance policy on Idaho property where no primary liability is assumed.

(6) The director of the department of insurance, for the purpose of carrying out this chapter shall have the right to require title insurers issuing policies in Idaho and title insurance agents to submit such information as needed as to expense of operations, loss experience, underwriting risks and other material matters.

(7) Any person aggrieved by any order, act or regulation of the director hereunder shall have the rights and remedies set forth in chapter 52, title 67 , Idaho Code.

Legislative History: [41-2705, added 1973, ch. 135, sec. 2, p. 252; am. 2011, ch. 195, sec. 1, p. 556; am. 2015, ch. 275, sec. 2, p. 1132.]

I.C. § 41-2706: Title insurance rates — Justification¶

Title insurance premium rates for the basic classification of policies and underwriting contracts shall be those filed by a title insurer or a title insurance rating organization with justification and approved by order of the director of the department of insurance, or, those filed by the director of the department of insurance with his justification therefor, hearing thereon and order of the director, both as more particularly hereinafter set forth. The division of the total premium between a title insurer and a title insurance agent shall be filed by the title insurer. The insurance premium rates on basic classification of policies and said division of total premium shall be deemed fixed by the director of the department of insurance upon the director’s order approving the same (i) as filed and justified by a title insurer or title insurance rating organization, with or without hearing, or (ii) following a hearing on the same as filed and justified by the director of the department of insurance.

(1) Justification of title insurance rates proposed by a title insurer, a title insurance rating organization, or the director of the department of insurance shall be filed with any proposed change of rate, and the filing shall be justified by:

(a) the experience or judgment of the title insurer or title insurance rating organization or the director proposing the rates; or

(b) its interpretation of any statistical data relied upon; or

(c) the experience of other title insurers or title insurance rating organizations; or

(d) any other factors which the title insurer or rating organization or director deems relevant.

(2) Rates made hereunder shall not be excessive, nor inadequate for the safety and soundness of the title insurer and title insurance agent, and shall not be unfairly discriminatory, and shall be adopted giving due consideration to:

(a) desirability of stability of rate structures;

(b) necessity of assuring the financial solvency of a title insurer and title insurance agent in periods of economic depression by encouraging growth in assets of title insurers and title insurance agents in periods of high business and activity; and

(c) necessity for assuring a reasonable margin of underwriting profit sufficient to induce capital to be invested therein.

(3) Every title insurer and every title insurance rating organization shall adopt basic classifications of policies and contracts of title insurance which shall be used as the basis for rates. Rates for each classification may, at the discretion of the title insurer, or the title insurance rating organization filing the rate, be less than the cost of the expense elements in the case of smaller insurances, and the excess may be charged against larger insurances without rendering the rate unfairly discriminatory.

(4) When the director finds upon application by a title insurer that any rate for a particular kind or class of risk cannot practicably be filed before it is used, or any contract or kind of title insurance, by reason of rarity or peculiar circumstances, does not lend itself to advance determination and filing of rates, he may, under such rules and regulations as he may prescribe, permit such rate or contract or kind of title insurance to be used without a previous notice and thirty (30) day waiting period.

Legislative History: [I.C., sec. 41-2706, as added by 1973, ch. 135, sec. 3, p. 252; am. 2011, ch. 195, sec. 2, p. 557.]

I.C. § 41-2707: Filing of title insurance rates — Hearings¶

(1) Pursuant to such regulations as the director of the department of insurance may adopt, every title insurer or rating organization shall file with the director of the department of insurance its schedule of rates, basic classifications of policies or contracts, and rules pertaining thereto, and every modification of any of the foregoing, and the director of the department of insurance may file for modifications of any of such rates, basic classifications, and rules previously filed and approved or under consideration for approval. Every filing by a title insurer, rating organization of the director of the department of insurance shall propose an effective date and shall not be effective until:

(a) notice of such filing shall forthwith be given to title insurers qualified to do business in the state of Idaho and the filing shall be available for public inspection for thirty (30) days after its date of filing;

(b) any interested party may file comments on and objections to the proposed filing or any part set forth therein during said period of public inspection;

(c) in the event of a filing by a title insurer or rating organization, whether or not comment or objection thereon has been received, which, in the judgment of the director, meets the requirements of section 41-2706 , Idaho Code, the same may be approved without public hearing; and

(d) on any filing by an insurer or rating organization which upon review the director believes he may disapprove, or on a filing made by the director, the director shall hold a public hearing on or before sixty (60) days from the date of the original filing upon not less than ten (10) days’ written notice of the hearing specifying in reasonable detail the matters to be considered at such hearing, notice to be given to every title insurer and title insurance rating organization, and to such other persons who have filed objection or comment thereto.

Upon such hearing, and not later than thirty (30) days thereafter, the director of the department of insurance shall order all or any part of such filing which he deems approved to be in effect as of the date of such order, and if he finds the filing or a part thereof does not meet the requirements of title 41 , Idaho Code, he shall issue an order specifying in what respects he finds that it so fails, stating when, within a reasonable period thereafter, such filing or a part thereof shall no longer be deemed effective if such filing or a part thereof has been effective prior thereto. Such order shall not affect any contract or policy made or issued prior to the effective date of said order changing any rate, or policy classification or form.

A title insurer, a title insurance rating organization or the director shall have the right at any time prior to an order thereon to withdraw a filing or a part thereof. Notice of such withdrawal shall be sent to each title insurer in the state that received notice of the original filing and to any person commenting on the filing.

(2) Any person or organization, other than a title insurer or title insurance rating organization, aggrieved by any filing in effect or proposed may make written application to the director specifying in reasonable detail the grounds of the objection relied upon by the applicant. The director, upon finding such application is made in good faith, there is reasonable cause for the grounds alleged by the applicant, that the applicant would be so aggrieved if his grounds are established, and that such grounds otherwise justify holding a hearing, shall, within ninety (90) days after receipt of such application, hold a hearing upon not less than thirty (30) days’ written notice to the applicant and to every title insurer, title insurance rating organization, and agent involved in the filing challenged. If, after such hearing, the director finds that the filing or a part thereof does not meet the requirements of title 41 , Idaho Code, he shall issue an order specifying in what respect he finds that such filing or part thereof fails to meet the requirements, and stating when, within a reasonable period thereafter, such filing or a part thereof shall be deemed no longer effective. Copies of the order shall be sent to the applicant and to every such title insurer and title insurance rating organization and agent. Such order shall not affect any contract or policy made or issued prior to the expiration of the period set forth in the order.

(3) No filing nor any modification thereof shall be disapproved if the rate in connection therewith meets the requirements of this chapter.

Legislative History: [I.C., sec. 41-2707, as added by 1973, ch. 135, sec. 4, p. 252; am. 1977, ch. 142, sec. 9, p. 310.]

I.C. § 41-2708: Determination of insurability — Prohibited risks — Rebates¶

(1) Insurability. No title insurance on real property in the state of Idaho shall be issued unless and until the title insurer or its agent:

(a) Owns or leases, separately or jointly with another, tract indexes and abstract records of the county in which the property is located; and

(b) Has caused to be made a search and examination of the title and a determination of insurability of title in accordance with sound title underwriting practices.

Evidence thereof for each policy shall be preserved and retained in the files of the title insurer or its agent. In lieu of retaining the original copy, the same may be reproduced by any photographic, photostatic, microfilm or microcard type of system or process that actually reproduces or forms a durable medium for reproducing the original.

(2) Prohibited risks. No title insurer doing business in this state shall guarantee the payment of deeds of trust or mortgages on real property. Nor shall any title insurer intentionally issue a title insurance policy without showing any outstanding enforceable recorded liens and encumbrances which are of record against the real property, except under circumstances the director of the department of insurance under his rulemaking powers may approve. Such guaranty of mortgage payments or intentional omission of such outstanding liens and encumbrances in violation hereof shall, upon proof thereof to the satisfaction of the director of the department of insurance, subject the insurer to a fine not to exceed two thousand dollars ($2,000) and to the revocation of, suspension of, or refusal to renew a certificate of authority.

(3) Rebates. Section 41-1314 (1), Idaho Code, shall be applicable to any person or entity and all employees, officers, agents, attorneys and solicitors thereof engaging in the title insurance business as to rebates and illegal inducements as in said section defined. The words "as inducement to such insurance" and "or in connection therewith" shall be construed to include but not be limited to underwriting premium, agent’s commission, abstracting charges, title examination fees, closing charges, escrow fees, trustee fees, and foreclosure fees relating to deeds of trust. No insured in a policy nor any other person directly or indirectly connected with the transaction involving the issuance of a title insurance policy, including but not limited to mortgage brokers, real estate brokers and agents, builders or attorneys, nor any employee, agent or representative or solicitor thereof, shall knowingly receive or accept, directly or indirectly, any such rebate or illegal inducement. No title insurance company or title insurance agent shall quote or make any charge for title insurance to any person less than the currently filed rate for such risk with the department of insurance. Nothing in this section or this title shall be deemed to prohibit a title insurer or title insurance agent from providing a reimbursement or discount of the premium otherwise payable for a title insurance policy and for any escrow fees otherwise charged in a transaction handled by such title insurance company or title insurance agent involving a bona fide employee’s residence. Each such person and entity giving or receiving a rebate, illegal inducement or a reduction in rate in violation of this section shall, in addition to the other penalties set forth in title 41 , Idaho Code, for violation thereof, be liable for three (3) times the amount of such rebate, illegal inducement or reduced rate.

(4) Forwarding fees. No person forwarding or directing title insurance business to a title insurer or title insurance agent in Idaho, nor such insurer or agent receiving such business, shall give or receive anything of value, or a portion of the premium, therefor.

Legislative History: [41-2708, added 1973, ch. 135, sec. 5, p. 252; am. 2018, ch. 213, sec. 2, p. 482.]

I.C. § 41-2709: Personal or controlled insurance¶

(1) Personal or controlled insurance means a policy of title insurance where the insured or one (1) of the insureds under such policy is, or the loss thereunder is payable to:

(a) the title insurer issuing such policy or to any person or entity directly or indirectly owning or controlling a majority of the voting stock or ownership in such title insurer, or any entity which is directly or indirectly controlled by a person or entity which also controls the title insurer described in this subsection (a); or

(b) a title insurance agent issuing such policy, or if the agent is a natural person, to his spouse, employer or employer’s spouse or such other person related to said persons mentioned within the first degree by blood or marriage, or if the employer is an entity, to any person directly or indirectly owning or controlling the majority of voting stock or ownership of such entity, or any partner or member of an association, and if the agent is an entity, to any person directly or indirectly owning or controlling the majority of the voting stock or ownership of such entity or any corporation which directly or indirectly controls such person who also controls the title insurance agent.

(2) If the rates and charges for personal or controlled insurance in any one (1) year received from any one (1) source by a title insurer or by a title insurance agency exceed twenty-five per cent (25%), or if from all sources of personal and controlled insurance exceed fifty per cent (50%), of the total rates and charges received by such title insurer or title insurance agent in the same year, the excess shall be deemed unlawful rebates. For the purpose of this provision, if the interest of the title insurer or title insurance agent is or was held by the same in a fiduciary capacity for the beneficial owner thereof reflected by a writing between the parties, the issuance of such title insurance policy by which title is conveyed to or by such title insurer or title insurance agent shall not be deemed controlled insurance.

(3) The provisions of sections 41-1310 , 41-1311 and 41-1312 , Idaho Code, with respect to controlled insurance business shall be deemed to include title insurance as well as the specific types of insurance named therein.

Legislative History: [I.C., sec. 41-2709, as added by 1973, ch. 135, sec. 6, p. 252.]

I.C. § 41-2710: Requirements for agents¶

(1) A title insurance agent is a person owning or leasing separately or with another licensed agent a complete set of tract indexes and abstract records of each county for which policies are written and authorized in writing by a title insurer to solicit insurance, issue or countersign policies, or otherwise engage in the title insurance business. A title insurer shall not allow or permit any person, firm, association or corporation to act as its agent in relation to the issuance of any certificate, title insurance policy, or other underwriting contract unless such person, firm, association or corporation shall first have obtained a title insurance agent’s license for each county for which policies are to be written from the director of the department of insurance. No person, firm, association or corporation shall act within this state as such agent for any title insurer without first having obtained a license from the director of insurance and filed a bond or cash deposit in lieu thereof as required herein.

(2) A separate agent’s license for each county shall be issued by the director of the department of insurance upon due showing filed by the applicant upon forms to be provided by the director of the department of insurance and payment of a fee of fifty dollars ($50.00), upon oath, that such applicant if an individual, is a bona fide resident of Idaho, if a firm or association is composed wholly of Idaho residents, or if a corporation is duly authorized or qualified to do business in the state, that the individual agent (or if a corporation or association, its managerial personnel who are going to exercise the license privilege) has reasonable experience or instruction in the field of title examinations and title insurance and the insurance laws of Idaho, that the applicant owns or leases, separately or with another, and maintains an adequate, complete set of tract indexes and abstract records of each county wherein he proposed to do business, and such application shall be endorsed by the title insurer with whom he proposed to do business that the proposed agent is known to have a good reputation and is worthy of public trust and that such title insurer knows of no fact or condition that would disqualify the agent from receiving the permit. An agent’s license shall continue from the date issued until the first day of January of each year and shall be automatically renewed thereon upon the payment of the annual fee of fifty dollars ($50.00) by the agent, unless terminated as herein provided by the director of the department of insurance for cause. If the filing fee is not promptly paid, the applicant shall be subject to a late filing fee of two dollars ($2.00) a day up to a maximum of one hundred dollars ($100).

(3) Upon the termination of any agency by a title insurer or by the agent terminating, the title insurer shall immediately notify the director of the department of insurance in writing and a title insurance agent shall forthwith notify the director of the department of insurance of the name of a new title insurer with whom he proposes to do business, with the new title insurer’s endorsement upon said notification. No title insurer shall allow the license of an agent for which it has vouched to continue unless all of the foregoing conditions have been complied with.

(4) The license of any title insurance agent may be denied, or the license suspended, revoked or renewal thereof refused, by the director of the department of insurance after notice and hearing if he finds that such license holder has:

(a) Willfully violated any provisions of title 41 , Idaho Code, or the rules issued thereunder;

(b) Has intentionally made a material misstatement in the application for such license;

(c) Has obtained or attempted to obtain such license by fraud or misrepresentation;

(d) Has misappropriated or converted to his own use or illegally withheld money belonging to a title insurance company, an insured or any other person;

(e) Has demonstrated his lack of trustworthiness or competence to act as such agent or been guilty of fraudulent or dishonest practices;

(f) Has materially misrepresented the terms and conditions of a title insurance policy or contract, or the condition of the title represented thereby; or

(g) Has failed to maintain a separate and distinct accounting of escrowed funds and has failed to maintain an escrow bank account or account separate and apart from all other accounts.

(5) Before any license is denied, suspended or revoked or renewal refused, the director shall give thirty (30) days’ written notice by registered mail to the licensee or applicant and the title insurer represented by the agent, and if said agent or title insurer desires, to set a date of hearing and to allow the production of evidence by said parties or any other interested person as to the matter. The right and remedies of the parties shall be as set forth in chapter 52, title 67 , Idaho Code. Any decision of the director of the department of insurance shall be made in writing and filed in his office and mailed to the title insurer and agent involved.

(6) As a condition of obtaining said license, the individual to be licensed for himself or the entity to be licensed for each employee escrow officer shall obtain, file and pay for a surety bond as provided for an escrow officer.

(7) Regular examination of the tract indexes, abstract records, and any other records to ascertain compliance with title 41 , Idaho Code, and related rules, of a title agent after the first examination thereof by the director shall be limited to not more than every fifth year, unless the agent otherwise requests or the director has cause to believe the same does not comply with this chapter or the rules thereunder. The director shall prepare an examination report following each examination and shall provide such report to the title agent being examined affording the person up to twenty-eight (28) days within which to review, comment and request a hearing. Unless a hearing is requested in accordance with chapter 2, title 41 , Idaho Code, the examination report shall be deemed available to the public notwithstanding the exemptions from disclosure provided in chapter 1, title 74 , Idaho Code. In addition, if the title agency affirmatively requests, any reply to the examination report shall be deemed available to the public notwithstanding the exemptions from disclosure provided in chapter 1, title 74 , Idaho Code. However, all working papers and other records produced by, obtained by or disclosed to the director or any other person in the course of an examination hereunder shall be made available to the person or company which was the subject of the examination in any proceeding pursuant to chapter 2, title 41 , Idaho Code, but shall otherwise be held by the director as an exempt record not required to be made public.

Legislative History: [41-2710, added 1973, ch. 135, sec. 7, p. 252; am. 2010, ch. 96, sec. 1, p. 182; am. 2015, ch. 141, sec. 111, p. 461.]

I.C. § 41-2711: Requirements for title insurance related business — Bonds¶

An escrow officer is an officer or an employee of a title insurance agent whose duties include any of the following: handling escrows, settlements, closings, and funds related thereto, except there are not to be included employees whose duties are wholly clerical or to act only as cosigners of escrow drafts. Each title insurance agent holding a license under this chapter, shall file with the director of insurance on or before January 1, of each year, and amend the same for new escrow officers employed within thirty (30) days of such employment, upon forms furnished by the director of insurance, the name and address of each person employed by it to serve in the capacity of an escrow officer. No title insurance agent shall permit any person to act as an escrow officer within this state beyond the time for compliance with the foregoing conditions. The director of insurance shall keep a record of the names and addresses of all escrow officers whose names have been duly filed with him as employed by title insurance agents within the state.

Every title insurance agent shall procure at its expense and file with the director of insurance a corporate surety bond of the type hereinafter set forth. The bond shall be in the minimum amount of ten thousand dollars ($10,000) per county in which the title insurance agent is licensed and increased in increments of ten thousand dollars ($10,000) corresponding to each additional person employed as an escrow officer in the county, provided that the maximum bond required of any title insurance agent shall be fifty thousand dollars ($50,000) irrespective of the number of counties in which the agent is licensed or the number of escrow officers employed and provided that the manager or supervisor of the title insurance agent’s principal office in a county shall not be counted as an escrow officer in determining the amount of the title insurance agent’s bond. The bond shall run to the director of insurance and the condition of the bond shall be that the title insurance agent shall pay damages which may be sustained by the public in the conduct of title insurance related business as defined in section 41-2704 (3), Idaho Code, by reason of the title insurance agent’s failure to comply with the provisions of this act and the regulations promulgated pursuant thereto by the director of insurance which shall include damages sustained by reason of fraud, dishonesty, forgery, theft or wilful misapplication of funds committed by the title insurance agent and its employees. Such bond(s) may be by blanket form coverage. In lieu of such bond, cash or securities approved by the director in like amount may be deposited through the director of insurance under custodial arrangement as provided for deposits by insurers under section 41-804 , Idaho Code. The cash or securities so deposited shall be subject to the same condition as the bond.

If at any time it appears to the director that the terms of such bond may have been violated, the director may require the agent to appear in Boise with such records as he deems proper on the date not earlier than ten (10) days and not later than twenty-five (25) days after service of such notice, and there conduct an examination into the matter. If, upon examination the director is satisfied that the terms of the bond have been violated, he shall forthwith notify the surety and prepare a written statement covering the facts and deliver it to the attorney general of Idaho, with copy to the surety, whose duty it shall be to investigate the charges, and if satisfied that the terms of the bond have been violated, then to enforce the liability against the cash or securities, or by suit on said bond in Ada County in the name of the director of the department of insurance for the benefit of all parties who have suffered any loss because of the breach of the terms of said bond or deposit.

The provisions of this section as to escrow officers and the requirement for filing escrow fee rates with the director shall also be applicable to any corporation twenty-five per cent (25%) or more of the capital stock or ownership of which is directly or indirectly owned by a title insurer or title insurance agent, or any person or entity directly or indirectly owning a majority of the stock or ownership of such insurer or agent.

Legislative History: [I.C., sec. 41-2711, as added by 1973, ch. 135, sec. 8, p. 252; am. 1975, ch. 209, sec. 1, p. 580.]

I.C. § 41-2712: Title insurance rating organization¶

(1) Finding. There are at the present time more than twelve (12) title insurers to which this chapter applies. Reasonable competition exists among said insurers with respect to classes of insurance written on titles. Said title insurers are not members of or subscribers to any rating organization with respect to their operation in Idaho. Some of said insurers presumably would become members of or subscribers to a rating organization if the same existed in relation to title insurance in this state. It is reasonable to assume that competition will continue to exist among the title insurers if ratemaking in concert were authorized and rating organizations were licensed in this state for such insurance. So long as reasonable competition continues in title insurance, the public welfare is served both by the making of rates in concert and by the making of rates by individual insurers, and no review thereof by the state is necessary or desirable in the public interest with respect to such class of insurance. So long as such competition continues, regulation adequate to protect the welfare of the citizens of the state with respect to such ratemaking in concert and such rating organization may be secured by licensing and periodic examination of the rating organization.

(2) Declaration of Policy. It is the purpose of this section to regulate title insurance within the scope hereby by allowing a title insurer or title insurance agent by becoming a member of a licensed title insurance rating organization making a filing under this chapter to satisfy its obligations for such filings; to authorize ratemaking in concert and the operation of the rating organization subject to regulations provided in this chapter; to retain and preserve the benefits flowing from reasonable competition; and to provide a review of such rates by the state for such classes of insurance within the scope of this chapter, if any, in which such reasonable competition may not hereafter exist.

(3) Rating Organization. A rating organization as defined, established and regulated in sections 41-1415 and 41-1416 , Idaho Code, may be established for the title insurance business. The same may be licensed and commence business as therein provided upon hearing and findings by the director of the department of insurance in accordance herewith. Filings may be made thereby by a rating organization consisting of six (6) or more title insurers receiving over fifty per cent (50%) of the title insurance premiums on business in the state pursuant to sections 41-2706 and 41-2707 , Idaho Code.

(4) After hearing upon thirty (30) days to the rating organization and its members and upon a finding by the director that reasonable competition no longer exists with respect to any or all of the classes of title insurance, and upon ninety (90) days’ expiration after notice thereof, and for so long thereafter as such finding with respect thereto continues in effect, such rating organization may not make filings herein authorized as to such class or classes of title insurance.

(5) A rating organization subject to rules and regulations approved by the director shall admit any title insurer applying thereto as a member or as a subscriber to its rating service at reasonable cost and without discrimination or to withdraw therefrom. The cooperation of title insurance rating organizations and the cooperation of the rating organization and title insurer, and the concert action by title insurers under this general management control of the rating organization in ratemaking and other matters within the scope of title 41 , Idaho Code, is hereby authorized, providing the premium rates for basic classification of policies, escrow fee rates, division of premium with agents and contracts are filed and approved in accordance with sections 41-2706 and 41-2707 , Idaho Code.

(6) Deviations. Every member of or subscriber to a title insurance rating organization shall adhere to the filings made on its behalf by such organization, except that any title insurer member or subscriber may file with the director a decrease or increase to be applied to any and all elements of the rates produced by the rating system so filed for the class of title insurance upon a finding by the director that it is a proper rating unit for the application of such decrease or increase or proper to be applied to the rates for a particular area. Such deviation filing shall specify the basis for the modification and be accompanied by statistical or historical pattern justification. A copy of said filing shall be filed with the rating organization. Such deviation filing shall be subject to the provisions of sections 41-2706 and 41-2707 , Idaho Code. Deviations shall be effective for one (1) year unless terminated sooner by order of the director.

(7) Appeals by the Minority. Any member of or subscriber to the rating organization may appeal to the director from any action or decision of the rating organization and the director shall, after hearing held upon not less than fifteen (15) days’ written notice to the applicant and the rating organization, issue an order approving the rating organization’s action or directing it to give further consideration thereto, all within thirty (30) days following such order. On the appeal from the decision or action of the rating organization the director may, in the event he finds such decision or action was unreasonable, issue an order directing said rating organization to make additions to its filings on behalf of its members or subscribers, including approval of the filing suggested by the appellant, if either be in accordance herewith. Failure of a rating organization to take action or make a decision within sixty (60) days after submission of a proposal for deviation shall constitute a rejection thereof.

Legislative History: [I.C., sec. 41-2712, as added by 1973, ch. 135, sec. 9, p. 252.]

I.C. § 41-2713: Administration — Examination costs¶

In the exercise of the powers of the director of the department of insurance to supervise and regulate title insurers, title insurance agents and title insurance rating organizations as provided in this chapter, as well as the powers of examination set forth in sections 41-219 and 41-220 , Idaho Code, each title insurer, title insurance agent or rating organization regulated or examined shall, at the direction of the director, pay directly to such person charged with enforcing the law or regulations and making the examinations, actual travel expenses, a reasonable expense allowance, and compensation, at reasonable rates as approved by the director of the department of insurance, necessarily incurred in such matters on the presentation of a detailed account of such charges and expenses. A title insurer shall be charged for the original examination of a title insurance agent which the insurer desires to represent it, and a title insurer or rating organization shall be charged directly for hearings upon any hearing originated by filings made by it. The regulation and examination direct charges herein provided may include both field work and work in the office of the director necessary thereto.

Separately from the direct charges herein provided, the director may levy a general charge upon each title insurer in proportion to the gross premiums from title insurance written by it to defray the costs of regulation required by this chapter. Provided, nevertheless, a title insurer shall not be charged in any one (1) year, separately from the direct charges for examination under section 41-219 , Idaho Code, said plant examination and said hearings, in excess of one per cent (1%) of the gross premiums as defined in section 41-402 , Idaho Code, for title insurance written on Idaho real property in said year, provided the director in the first year after the effective date hereof may charge not in excess of two per cent (2%) of the gross premiums and may levy said charge after July 1, 1973, in advance based on the prior year’s premiums. The director from year to year may carry forward any unexpended balance of general charges made in a rotating fund for said expenses to be incurred thereafter.

Legislative History: [I.C., sec. 41-2713, as added by 1973, ch. 135, sec. 10, p. 252.]

I.C. § 41-2714: closing or settlement protection¶

(1) A title insurer may issue closing or settlement protection to a buyer, borrower or lender that is a party to a transaction in which a title insurance policy will be issued. The closing or settlement protection shall be on a form filed with the department in accordance with section 41-2705 , Idaho Code.

(2) The closing or settlement protection shall be limited to indemnifying the buyer, borrower or lender insured against a loss due to either or both of the following actions of a licensed and authorized title insurance agent and is deemed for the purpose of this section to be within the business of title insurance as set forth in section 41-2704 , Idaho Code:

(a) Theft or misappropriation of closing or settlement funds in connection with a transaction in which a title insurance policy or title insurance policies will be issued by or on behalf of the title insurer issuing the closing or settlement protection.

(b) Failure to comply with the written closing instructions when agreed to by the title agent or title insurer, but only to the extent that the failure to follow the instructions relates to the status of the title to that interest in land or the validity, enforceability and priority of the lien of the mortgage on that interest in land.

(3) A rate must be charged and the rate charged by a title insurer for each transaction that includes closing protection coverage shall not be subject to any agreement requiring a division of rates or premiums collected on behalf of the title insurer. The issuance of a closing or settlement protection to a buyer, borrower or lender that is a party to a transaction in which a title insurance policy will be issued shall be considered to be one (1) transaction for which a single rate is charged and shall not result in a separate charge to each party. The rate shall:

(a) Be filed with the department in accordance with sections 41-2706 and 41-2707 , Idaho Code;

(b) Be the only rate charged for closing protection; and

(c) Not exceed twenty-five dollars ($25.00).

(4) A title insurer may not provide any other protection that purports to indemnify against improper acts or omissions of a person with regard to closing or settlement services.

(5) Except as otherwise provided for in closing or settlement protection, a buyer, borrower, lender, or title insurer retains all their respective rights and remedies in connection with losses suffered due to theft or misappropriation of closing or settlement funds or the failure to comply with written closing instructions. Nothing in this section shall be construed to require a buyer, borrower or lender to obtain closing or settlement protection. A failure to obtain closing or settlement protection shall not be construed as an error, omission or other breach of duty of a buyer, borrower or lender.

Legislative History: [41-2714, added 2015, ch. 275, sec. 3, p. 1133.]

Chapter 30¶

I.C. § 41-3001: Definitions¶

As used in this chapter:

(1) "Contract" means an annuity contract. The term "contract" shall not include an annuity used to fund an employment-based retirement plan or program where:

(a) The insurer does not perform the recordkeeping services; or

(b) The insurer is not committed by terms of the annuity contract to pay death benefits to the beneficiaries of specific plan participants.

(2) "Death master file" means the United States social security administration’s death master file or any other database or service that is at least as comprehensive as the United States social security administration’s death master file for determining that a person has reportedly died.

(3) "Death master file match" means a search of the death master file that results in a match of the social security number or the name and date of birth of an insured, annuity owner or retained asset account holder.

(4) "Knowledge of death" means:

(a) Receipt of an original or valid copy of a certified death certificate; or

(b) A death master file match validated by the insurer in accordance with section 41-3002 , Idaho Code.

(5) "Policy" means any policy or certificate of life insurance that provides a death benefit. The term "policy" shall not include:

(a) Any policy or certificate of life insurance that provides a death benefit under an employee benefit plan that is:

(i) Subject to the employee retirement income security act of 1974, 29 U.S.C. section 1002, as periodically amended; or

(ii) Under any federal employee benefit program;

(b) Any policy or certificate of life insurance that is used to fund a preneed funeral contract or prearrangement;

(c) Any policy or certificate of credit life or accidental death insurance; or

(d) Any policy issued to a group master policyholder for which the insurer does not provide recordkeeping services.

(6) "Recordkeeping services" means those circumstances under which the insurer has agreed with a group policy or contract customer to be responsible for obtaining, maintaining and administering in its own or its agents’ systems information about each individual insured under an insured’s group insurance contract, or a line of coverage thereunder, at least the following information:

(a) Social security number or name and date of birth;

(b) Beneficiary designation information;

(c) Coverage eligibility;

(d) Benefit amount; and

(e) Premium payment status.

(7) "Retained asset account" means any mechanism whereby the settlement of proceeds payable under a policy or contract is accomplished by the insurer or an entity acting on behalf of the insurer depositing the proceeds into an account with check or draft writing privileges, where those proceeds are retained by the insurer or its agent, pursuant to a supplementary contract not involving annuity benefits other than death benefits.

Legislative History: [41-3001, added 2015, ch. 74, sec. 1, p. 194.]

I.C. § 41-3002: insurer conduct¶

(1) An insurer shall perform a comparison of its insureds’ in-force policies, contracts and retained asset accounts against a death master file, on at least a semiannual basis, by using the full death master file once and thereafter using the death master file update files for future comparisons to identify potential matches of its insureds. For those potential matches identified as a result of death master file match, the insurer shall:

(a) Within ninety (90) days of a death master file match:

(i) Complete a good faith effort, which shall be documented by the insurer, to confirm the death of the insured, annuity owner or retained asset account holder against other available records and information;

(ii) Determine whether benefits are due in accordance with the applicable policy or contract; and

(iii) If benefits are due in accordance with the applicable policy or contract, use good faith efforts, which shall be documented by the insurer, to locate the beneficiary or beneficiaries and provide the appropriate claims forms or instructions to the beneficiary or beneficiaries to make a claim including the need to provide an official death certificate, if applicable under the policy or contract.

(b) With respect to group life insurance, insurers are required to confirm the possible death of an insured when the insurers maintain at least the following information of those covered under a policy or certificate:

(i) Social security number or name and date of birth;

(ii) Beneficiary designation information;

(iii) Coverage eligibility;

(iv) Benefit amount; and

(v) Premium payment status.

(c) Every insurer shall implement procedures to account for:

(i) Common nicknames, initials used in lieu of a first or middle name, use of a middle name, compound first and middle names and interchanged first and middle names;

(ii) Compound last names, maiden or married names and hyphens, and blank spaces or apostrophes in last names;

(iii) Transposition of the month and date portions of the date of birth; and

(iv) Incomplete social security number.

(d) To the extent permitted by law, the insurer may disclose minimum necessary personal information about the insured or beneficiary to a person who the insurer reasonably believes may be able to assist the insurer locate the beneficiary or a person otherwise entitled to payment of the claims proceeds.

(2) An insurer or its service provider shall not charge any beneficiary or other authorized representative for any fees or costs associated with a death master file search or verification of a death master file match conducted pursuant to this section.

(3) The benefits from a policy, contract, or retained asset account, plus any applicable accrued contractual interest, shall first be payable to the designated beneficiaries or owners and in the event such beneficiaries or owners cannot be found shall escheat to the state as unclaimed property pursuant to chapter 5, title 14 , Idaho Code. Interest payable under section 41-1337 , Idaho Code, shall not be payable as unclaimed property under chapter 5, title 14 , Idaho Code.

(4) An insurer shall notify the unclaimed property administrator upon the expiration of the statutory time period for escheat that:

(a) A policy or contract beneficiary or retained asset account holder has not submitted a claim with the insurer; and

(b) The insurer has complied with subsection (1)(a) of this section and has been unable, after good faith efforts documented by the insurer, to contact the retained asset account holder, beneficiary or beneficiaries.

(5) Upon such notice, an insurer shall immediately submit the unclaimed policy or contract benefits or unclaimed retained asset accounts, plus any applicable accrued interest, to the unclaimed property administrator.

Legislative History: [41-3002, added 2015, ch. 74, sec. 1, p. 195; am. 2024, ch. 27, sec. 7, p. 218.]

I.C. § 41-3003: unfair trade practice¶

Failure to meet any requirement of this act with such frequency as to constitute a general business practice is a violation of chapter 13, title 41 , Idaho Code. Nothing contained in this section shall be construed to create or imply a private cause of action for a violation of this section.

Legislative History: [41-3003, added 2015, ch. 74, sec. 1, p. 196.]

Chapter 56¶

I.C. § 41-5601: Definitions¶

As used in this chapter:

(1) "Beneficiary" means a policyholder, subscriber, member, employer or other person who is eligible for benefits under a contract providing hospital, surgical, or medical expense coverage or a managed care organization policy or agreement under which a third party payer agrees to reimburse for covered health care services rendered to beneficiaries in accordance with the benefits contract.

(2) "Date of payment" means the date the payment is sent as indicated by the mail stamp on the envelope, by the insurer to the practitioner or facility or to the beneficiary in the event there is not a contract for direct payment by the insurer to the practitioner or facility, or, in the event of a wire or other electronic funds transfer, upon acceptance by the insurer’s bank of a payment order.

(3) "Department" means the department of insurance.

(4) "Director" means the director of the department of insurance.

(5) "Electronic claim" means a claim that is transmitted through the use of electronic media, which includes the internet, extranet, leased lines, dial-up lines, private networks, and those transmissions that are physically moved from one (1) location to another using magnetic tape, disk or compact disk media. The claim shall contain the proper format and code sets in accordance with the applicable implementation specifications under 45 CFR 160 et seq., and 45 CFR 162 et seq.

(6) "Insurer" means any insurer that sells hospital, medical, long-term care, or vision insurance policies or certificates and managed care organizations. For the purpose of this chapter only, "insurer" also includes a third party administrator who makes payments to beneficiaries, practitioners or facilities on behalf of an insurer and a hospital or professional service corporation that provides hospital, medical, long-term care or vision health care services.

(7) "Practitioner or facility" means any physician, hospital or other person or facility licensed or otherwise authorized to furnish health care services.

(8) "Receipt of claim" means the date the claim is actually received by the insurer from the practitioner or facility or the beneficiary.

(9) "Submission of claim" means the date the claim is sent as indicated by the mail stamp on the envelope, by the beneficiary, practitioner or facility, to the insurer or the date an electronic claim is transmitted to an insurer.

Legislative History: [41-5601, added 2004, ch. 290, sec. 1, p. 812.]

I.C. § 41-5602: Prompt payment of claims¶

(1) Except as otherwise specifically provided in this chapter, an insurer shall process a claim for payment for health care services rendered by a practitioner or facility to a beneficiary in accordance with this section.

(2) If a beneficiary, practitioner or facility submits an electronic claim to an insurer within thirty (30) days of the date on which service was delivered, an insurer shall pay or deny the claim not later than thirty (30) days after receipt of the claim.

(3) If a beneficiary, practitioner or facility submits a paper claim for payment to an insurer within forty-five (45) days of the date on which service was delivered, an insurer shall pay or deny the claim not later than forty-five (45) days after receipt of the claim.

(4) If an insurer denies the claim or needs additional information to process the claim, the insurer shall notify the practitioner or facility and the beneficiary in writing within thirty (30) days of receipt of an electronic claim or within forty-five (45) days of receipt of a paper claim. The notice shall state why the insurer denied the claim.

(5) If the claim was denied because more information was required to process the claim, the notice shall specifically describe all information and supporting documentation needed to evaluate the claim for processing. If the practitioner or facility submits the information and documentation identified by the insurer within thirty (30) days of receipt of the written notice, the insurer shall process and pay the claim within thirty (30) days of receipt of the additional information or, if appropriate, deny the claim.

(6) Any claim submitted pursuant to this chapter shall use the current procedural terminology (CPT) code in effect, as published by the American medical association, the international classification of diseases(ICD) code in effect, as published by the United States department of health and human services, or the healthcare common procedural coding system (HCPCS) code in effect, as published by the United States centers for medicare and medicaid services (CMS).

(7) This chapter shall not apply to claims submitted under policies or certificates of insurance for specific disease, hospital confinement indemnity, accident-only, credit, medicare supplement, disability income insurance, student health benefits only coverage issued as a supplement to liability insurance, worker’s compensation or similar insurance, automobile medical payment insurance or nonrenewable short-term coverage issued for a period of twelve (12) months or less.

Legislative History: [41-5602, added 2004, ch. 290, sec. 1, p. 813; am. 2005, ch. 66, sec. 1, p. 231; am. 2025, ch. 211, sec. 17, p. 983.]

I.C. § 41-5603: Interest payments¶

An insurer that fails to pay, request additional information or documentation or deny a claim from a beneficiary, practitioner or facility within the time periods established in this chapter shall pay interest at the contract statutory rate pursuant to section 28-22-104 , Idaho Code, on the unpaid amount of a claim that is determined to be due and owing. The interest shall accrue from the date payment was due, pursuant to the provisions of this chapter, until the claim is paid. Payment of any interest amount of less than four dollars ($4.00) shall not be required. Insurers may add any interest due to a future payment to the beneficiary, practitioner or facility.

Legislative History: [41-5603, added 2004, ch. 290, sec. 1, p. 814.]

I.C. § 41-5604: Assignment¶

Nothing in this chapter requires an insurer to accept an assignment of payment by the beneficiary to the practitioner or facility.

Legislative History: [41-5604, added 2004, ch. 290, sec. 1, p. 814.]

I.C. § 41-5605: Exceptions¶

(1) The time periods set forth in section 41-5602 , Idaho Code, shall not apply to claims that the insurer reasonably believes involve fraud or misrepresentation by the practitioner or facility or the beneficiary or to instances where the insurer has not been provided the information necessary to evaluate the claim after notice has been given requesting additional information by the insurer as required by section 41-5602 (5), Idaho Code.

(2) The time periods set forth in section 41-5602 , Idaho Code, shall not apply to claims that the insurer reasonably believes require medical records, including accident reports, for the purpose of investigating whether a claim is valid for subrogation, or the coordination of benefits payable by the insurer with benefits payable by another insurer or payable under federal or state law.

(3) An insurer is not required to comply with the time periods set forth in section 41-5602 , Idaho Code, if the insurer is in compliance with a contract with the practitioner or facility which specifies different payment requirements. Payments made within the time periods set forth in section 41-5602 , Idaho Code, for the purpose of this chapter, shall be deemed to be made in a reasonable and timely manner.

(4) An insurer is not required to comply with the periods set forth in section 41-5602 , Idaho Code, if the fee or premium entitling a beneficiary to insurance benefits has not been paid in full.

(5) An insurer is not required to comply with the time periods set forth in section 41-5602 , Idaho Code, if failure to comply is due to an act of God, bankruptcy, an act of a governmental authority responding to an act of God or emergency or the result of a strike, walkout or other labor dispute, or act of terrorism.

Legislative History: [41-5605, added 2004, ch. 290, sec. 1, p. 814.]

I.C. § 41-5606: Penalties¶

(1) The director shall enforce the provisions of this chapter and shall review and, if appropriate, investigate complaints received by the department related to noncompliance with the provisions of this chapter.

(2) If the director determines an insurer has violated the provisions of this chapter, the director may impose an administrative fine not to exceed five thousand dollars ($5,000) based upon an enforcement action.

(3) The director shall not suspend or revoke an insurer’s certificate of authority for violation of this chapter.

(4) No administrative penalty shall be imposed against an insurer under this chapter or any other provision of law for failure to comply with this chapter if, in the calendar year it has paid ninety-five percent (95%) or more of all claims subject to this chapter to or on behalf of beneficiaries within the time periods set forth in section 41-5602 , Idaho Code.

(5) This section shall not create a private cause of action by or on behalf of a beneficiary or practitioner or facility against an insurer.

Legislative History: [41-5606, added 2004, ch. 290, sec. 1, p. 815.]

Idaho Administrative Rules (IDAPA)¶

IDAPA 18.01.01¶

IDAPA 18.01.01.000 - Legal Authority¶

Title 41, Chapter 13, Section 41-1334, Idaho Code. (3-31-22)

IDAPA 18.01.01.001 - Title And Scope¶

1. Title. IDAPA 18.01.01, "Rule to Implement the Privacy of Consumer Financial Information." (3-31-22)

2. Scope. This rule describes the conditions under which a licensee may disclose nonpublic personal financial information about individuals to affiliates and nonaffiliated third parties and provides methods for individuals to prevent a licensee from disclosing that information. (3-31-22)

3. Applicability. This rule applies to nonpublic personal financial information about individuals who obtain or are beneficiaries of products or services primarily for personal, family, or household purposes from licensees. This rule does not apply to information about companies or individuals who obtain products or services for business, commercial, or agricultural purposes. (3-31-22)

IDAPA 18.01.01.010 - Definitions¶

All terms defined in Title 41, Chapters 1 and 13, Idaho Code, that are used in this rule have the same meaning as used in those chapters. In addition, the following terms are defined as used in this chapter. (3-31-22)

1. Clear and Conspicuous. (3-31-22)

   a. A notice is reasonably understandable and designed to call attention to the nature and significance of the information in the notice if it: (3-31-22)

   i. Presents the information in clear, concise sentences, paragraphs, and sections; (3-31-22)
   
   ii. Uses short explanatory sentences or bullet lists whenever possible; (3-31-22)
   
   iii. Uses definite, concrete, everyday words and active voice whenever possible; (3-31-22)
   
   iv. Avoids multiple negatives; (3-31-22)
   
   v. Avoids legal and highly technical business terminology whenever possible; (3-31-22)
   
   vi. Avoids explanations that are imprecise and readily subject to different interpretations. (3-31-22)
   
   vii. Uses an easy-to-read typeface and type size, and uses boldface or italics for key words; and (3-31-22)
   
   viii. When in a form that combines the licensee's notice with other information, uses distinctive type size, style, and graphic devices. (3-31-22)
   

   b. If a licensee provides a notice on a web page, the notice needs to call attention to the nature and significance of the information in the notice and place the notice on a screen that consumers frequently access, or place a link on a screen that consumers frequently access that connects directly to the notice. (3-31-22)

2. Collect. To obtain information that the licensee organizes or can retrieve by the name of an individual or by identifying number, symbol or other identifiers assigned to the individual. (3-31-22)

3. Company. A corporation, limited liability company, bus iness trust, general or limited partnership, association, sole proprietorship, or similar organization. (3-31-22)

4. Consumer. An individual who seeks to obtain, obtains, or has obtained an insurance product or service from a licensee used primarily for personal, family, or household purposes. Examples: (3-31-22)

   a. An individual who provides nonpublic personal information to a licensee in connection with an insurance product or service is a consumer regardless of whether the licensee establishes an ongoing advisory relationship. (3-31-22)

   b. An individual who is a consumer of another financial institution is not a licensee's consumer solely because the licensee is acting as agent for or provides processing or other services to the financial institution. (3-31-22)

   c. If the licensee provides the initial, annual, and revised notices under Sections 100, 150, and 300 of this rule to the plan sponsor, group or blanket insurance policyholder, or group annuity contract holder, and if the licensee does not disclose to a nonaffiliated third party nonpublic personal financial information about an individual other than as permitted under Sections 450, 451, and 452 of this rule, an individual is not the consumer of the licensee solely because he is: (3-31-22)

   i. A participant or a beneficiary of an employee benefit plan the licensee administers or sponsors or for which the licensee acts as a trustee, insurer, or fiduciary; or (3-31-22)
   
   ii. Covered under a group or blanket insurance policy or group annuity contract issued by the licensee. (3-31-22)
   
   iii. A beneficiary in a workers' compensation plan. (3-31-22)
   

   d. An individual is not a licensee's consumer solely because he is: (3-31-22)

   i. A beneficiary of a trust for which the licensee is a trustee; or (3-31-22)
   
   ii. Designated the licensee as trustee for a trust. (3-31-22)
   

5. Consumer Reporting Agency. Is the same meaning as found in Section 603(f) of the federal Fair Credit Reporting Act (15 U.S.C. 1681a(f)). (3-31-22)

6. Control: (3-31-22)

   a. Ownership, control, or power to vote twenty-five percent (25%) or more of the outstanding shares of any class of voting security of the company, directly or indirectly, or acting through one (1) or more other persons; (3-31-22)

   b. Control in any manner over the election of a majority of the directors, trustees, or general partners (or individuals exercising similar functions) of the company; or (3-31-22)

   c. The power to exercise, directly or indirectly, a controlling influence over the management or policies of the company, as the director determines. (3-31-22)

7. Customer. A consumer who has a customer relationship with a licensee. (3-31-22)

8. Customer Relationship. A continuing relationship between a consumer and a licensee under which the licensee provides one (1) or more insurance products or services to the consumer to be used primarily for personal, family, or household purposes. (3-31-22)

   a. A consumer does not have a continuing relationship with a licensee if: (3-31-22)

   i. The licensee sells the consumer travel insurance in an isolated transaction; (3-31-22)
   
   ii. The individual is no longer a current policyholder of an insurance product or no longer obtains insurance services with or through the licensee; (3-31-22)
   
   iii. The consumer is a beneficiary or claimant under a policy and has submitted a claim under a policy choosing either a lump sum settlement option or a settlement option involving an ongoing relationship with the licensee; (3-31-22)
   
   iv. The individual is an insured or an annuitant under an insurance policy or annuity, respectively, but is not the policyholder or owner of the insurance policy or annuity; or (3-31-22)
   

9. Financial Institution. Any institution engaging in activities that are financial in nature. Financial institution does not include: (3-31-22)

   a. Any person or entity with respect to any financial activity that is subject to the jurisdiction of the Commodity Futures Trading Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.); (3-31-22)

   b. The Federal Agricultural Mortgage Corporation or any entity charged and operating under the Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.); or (3-31-22)

   c. Institutions chartered by Congress specifically to engage in securitizations, secondary market sales (including sales of servicing rights) or similar transactions related to a transaction of a consumer, as long as the institutions do not sell or transfer nonpublic personal information to a nonaffiliated third party. (3-31-22)

10. Financial Product or Service. A product or service that a financial holding company could offer including a financial institution's evaluation or brokerage of information that the financial institution collects in connection with a request or an application from a consumer for a financial product or service. (3-31-22)

11. Licensee. (3-31-22)

    a. A licensee is not subject to the notice and opt out requirements for nonpublic personal financial information set forth in this rule if the licensee is an employee, agent, or other representative of another licensee ("the principal") and: (3-31-22)

    i. The principal complies with, and provides the notices prescribed by this rule; and (3-31-22)
    
    ii. The licensee does not disclose any nonpublic personal information to any person other than the principal or its affiliates in a manner permitted by this rule. (3-31-22)
    

    b. A licensee also includes an unauthorized insurer that accepts business placed through a licensed surplus lines broker in this state, but only in regard to the surplus lines placements placed pursuant to Title 41, Chapter 12, Idaho Code. (3-31-22)

12. Nonpublic Personal Information. (3-31-22)

    a. Means personally identifiable financial information; including any list, description or other grouping of consumers (see archived 18.01.48) derived using any personally identifiable financial information not publicly available. (3-31-22)

    b. Nonpublic personal financial information does not include: (3-31-22)

    i. Health information; (3-31-22)
    
    ii. Publicly available information, except as included on a list described in Subparagraph 010.11.a., of this rule; or (3-31-22)
    
    iii. Any list, description or other grouping of consumers derived without using any personally identifiable financial information that is not publicly available. (3-31-22)
    

13. Opt Out. A direction by the consumer that the licensee not disclose nonpublic personal financial information about the consumer to a nonaffiliated third party. (3-31-22)

14. Personally Identifiable Financial Information. (3-31-22)

    a. Any information: (3-31-22)

    i. A consumer provides to a licensee to obtain an insurance product or service from the licensee; (3-31-22)
    
    ii. About a consumer resulting from a transaction involving an insurance product or service between a licensee and a consumer. (3-31-22)
    

    b. Examples of personally identifiable financial information: (3-31-22)

    i. Account balance information and payment history; (3-31-22)
    
    ii. The fact that an individual is or has been one (1) of the licensee's customers or has obtained an insurance product or service from the licensee; (3-31-22)
    
    iii. Information about the licensee's consumer if it is disclosed in a manner that indicates the individual is or has been the licensee's consumer; (3-31-22)
    
    iv. Information provided by a consumer to a licensee or that the licensee or its agent obtains in connection with collecting on a loan or servicing a loan; (3-31-22)
    
    v. Information the licensee collects through an Internet cookie (an information-collecting device from a web server); and (3-31-22)
    
    vi. Information from a consumer report. (3-31-22)
    

    c. Personally identifiable financial information does not include: (3-31-22)

    i. Health information; (3-31-22)
    
    ii. A list of names and addresses of customers of an entity of a non-financial institution; and (3-31-22)
    
    iii. Information that does not identify a consumer, such as aggregate information or blind data that does not contain personal identifiers such as account numbers, names or addresses. (3-31-22)
    

15. Publicly Available Information. (3-31-22)

    a. Any information that a licensee has a reasonable basis to believe is lawfully made available to the general public. (3-31-22)

IDAPA 18.01.01.100 - Initial Privacy Notice To Consumers¶

1. Initial Notice Requirement. A licensee will provide a clear and conspicuous notice that accurately reflects its privacy policies and practices to: (3-31-22)

   a. A customer no later than when the licensee establishes a customer relationship, except as provided in Subsection 100.03 of this rule; and (3-31-22)

   b. A consumer, before the licensee discloses any nonpublic personal financial information about the consumer to any nonaffiliated third party, if the licensee makes a disclosure other than as authorized by Sections 451 and 452. (3-31-22)

2. Existing Customers. When an existing customer obtains a new insurance product or service from a licensee, which is used primarily for personal, family, or household purposes, the licensee satisfies the initial notice requirements of Subsection 100.01 of this rule if the notice that the licensee most recently provided to that customer was accurate with respect to the new insurance product or service, the licensee does not need to provide a new privacy notice under Subsection 100.01 of this rule. (3-31-22)

3. Exceptions Allowing Subsequent Delivery of Notice. A licensee may provide the initial notice prescribed in Paragraph 100.01.a. of this rule in a reasonable time after the licensee establishes a customer relationship if: (3-31-22)

   a. Establishing the customer relationship is not at the customer's election; or (3-31-22)

   b. It would avoid substantially delaying the customer's transaction and the customer agrees to receive the notice at a later time. (3-31-22)

IDAPA 18.01.01.150 - W¶

disclosures to other third parties. (3-31-22)

IDAPA 18.01.01.200 - Information To Be Included In Privacy Notices¶

The initial, annual and revised privacy notices a licensee provides, under Sections 100, 150, and 300, needs to include each of the following items of information, in addition to any other information the licensee wishes to provide: (3-31-22)

1. Information Licensee Collects or Discloses. The categories of nonpublic personal financial information the licensee collects or discloses. (3-31-22)

2. Parties to Whom Licensee Discloses. The categories of third parties to whom the licensee discloses nonpublic personal financial information, other than those parties to whom the licensee discloses information under Sections 451 and 452. (3-31-22)

3. Disclosures of Information About Former Customers. The categories of nonpublic personal financial information about the licensee's former customers the licensee discloses, and the categories of third parties to whom the licensee discloses nonpublic personal financial information about the licensee's former customers, other than those parties to whom the licensee discloses information under Sections 451 and 452. (3-31-22)

4. Disclosures Under Section 450. If a licensee discloses nonpublic personal financial information to a nonaffiliated third party under Section 450 (and no other exception in Sections 451 and 452 applies to that disclosure), a separate description of the categories of information the licensee discloses and the categories of third parties with whom the licensee has contracted is to provided. (3-31-22)

5. Explanation of Right to Opt Out. An explanation of the consumer's right under Subsection 400.01 to opt out of the disclosure of nonpublic personal financial information to nonaffiliated third parties, including the methods by which the consumer may exercise their right at that time. (3-31-22)

6. Disclosures Under Federal Law. Any disclosures the licensee makes under Section 603(d)(2)(A)(iii) of the federal Fair Credit Reporting Act (15 U.S.C. 1681a(d)(2)(A)(iii)) (notices regarding the ability to opt out of disclosures of information among affiliates); and the licensee's policies and practices with respect to protecting the confidentiality and security of nonpublic personal information. (3-31-22)

IDAPA 18.01.01.201 - Description Of Parties Subject To Exceptions¶

If a licensee discloses nonpublic personal financial information as authorized under Sections 451 and 452, the licensee is not obligated to list those exceptions in the initial or annual privacy notices prescribed by Sections 100 and

IDAPA 18.01.01.202 - Satisfying The Privacy Notice Information Requirements¶

1. Categories of Nonpublic Personal Financial Information That the Licensee Collects. A licensee satisfies the requirement to categorize the nonpublic personal financial information it collects if the licensee categorizes it according to the source of the information, as applicable: (3-31-22)

   a. Information from the consumer; (3-31-22)

   b. Information about the consumer's transactions with the licensee, its affiliates, or third parties; (3-31-22)

   c. Information from a consumer reporting agency. (3-31-22)

2. Categories of Nonpublic Personal Financial Information a Licensee Discloses. (3-31-22)

   a. A licensee satisfies the requirement to categorize nonpublic personal financial information it discloses if the licensee categorizes it according to the source, as described in Subsection 202.01 of this rule, and provides a few examples to illustrate the types of information in each category. (3-31-22)

   b. If a licensee reserves the right to disclose all of the nonpublic personal financial information about consumers that it collects, the licensee may simply state that fact without describing the categories or examples of nonpublic personal information the licensee discloses. (3-31-22)

3. Categories of Affiliates and Nonaffiliated Third Parties to Whom the Licensee Discloses. A licensee satisfies the requirement to categorize the third parties to which the licensee discloses nonpublic personal financial information about consumers if the licensee identifies the types of businesses in which they engage. Types of businesses may be described by general terms only if the licensee uses a few illustrative examples of significant lines of business. (3-31-22)

4. Disclosures Under Exception for Service Providers and Joint Marketers. If a licensee discloses nonpublic personal financial information under the exception in Section 450 to a nonaffiliated third party to market products or services it offers alone or jointly with another financial institution, the licensee satisfies the disclosure requirement of Subsection 200.04 of this rule if it: (3-31-22)

   a. Lists the categories of nonpublic personal financial information it discloses, using the same categories and examples the licensee used to meet the requirements of Subsection 200.01 of this rule; and (3-31-22)

   b. States whether the third party is: (3-31-22)

   i. A service provider that performs marketing services on the licensee's behalf or on behalf of the licensee and another financial institution; or (3-31-22)
   
   ii. A financial institution with whom the licensee has a joint marketing agreement. (3-31-22)
   

5. Simplified Notices. If a licensee does not disclose and does not wish to reserve the right to disclose nonpublic personal financial information about customers or former customers to third parties except as authorized under Sections 451 and 452, the licensee may simply state that fact, in addition to the information it provides under Subsections 200.01, 200.07, and Section 201 of this rule. (3-31-22)

6. Confidentiality and Security. A licensee describes its policies and practices with respect to protecting the confidentiality and security of nonpublic personal financial information if it does both of the following: (3-31-22)

   a. Describes in general terms who is authorized to have access to the information; and (3-31-22)

   b. States whether the licensee has security practices and procedures in place to ensure the confidentiality of the information in accordance with the licensee's policy. (3-31-22)

IDAPA 18.01.01.203 - Short-Form Initial Notice With Opt Out Notice For Non-Customers¶

1. Short-Form Initial Notice Allowed. A licensee may satisfy the initial notice requirements for a consumer who is not a customer, by providing a short-form initial notice at the same time the licensee delivers an opt out notice as prescribed in Section 250. (3-31-22)

2. Short-Form Initial Notice Requirements. A short-form initial notice will: (3-31-22)

   a. Be clear and conspicuous; (3-31-22)

   b. State that the licensee's privacy notice is available upon request; and (3-31-22)

   c. Explain a reasonable means by which the consumer may obtain the notice. (3-31-22)

3. Delivery of Short-Form Initial Notice. The licensee is not obligated to deliver its privacy notice with its short-form initial notice but may simply provide the consumer a reasonable means to obtain its privacy notice. If a consumer who receives the licensee's short-form notice requests the licensee's privacy notice, the licensee will deliver its privacy notice according to Section 350. (3-31-22)

4. Examples of Obtaining Privacy Notice. The licensee provides a reasonable means by which a consumer may obtain a copy of its privacy notice if the licensee: (3-31-22)

   a. Provides a toll-free telephone number the consumer may call to request the notice; (3-31-22)

   b. Maintains copies of the notice on hand at the licensee's office and provides it to the consumer immediately upon request; or (3-31-22)

   c. Posts it on their website. (3-31-22)

IDAPA 18.01.01.250 - Form Of Opt Out Notice To Consumers¶

1. Opt Out Notice Form. If a licensee is prescribed to provide an opt out notice under Subsection 400.01, it will provide a clear and conspicuous notice to each of its consumers that accurately explains the right to opt out under Section 400. The notice will state: (3-31-22)

   a. The licensee discloses or reserves the right to disclose nonpublic personal financial information about its consumer to a nonaffiliated third party; (3-31-22)

   b. The consumer has the right to opt out of that disclosure; and (3-31-22)

   c. A reasonable means by which the consumer may exercise the opt out right. (3-31-22)

2. Adequate Opt Out Notice. A licensee provides adequate notice that the consumer can opt out of the disclosure of nonpublic personal financial information to a nonaffiliated third party if the licensee: (3-31-22)

   a. Identifies all of the categories of nonpublic personal financial information that it discloses or reserves the right to disclose, and all of the categories of nonaffiliated third parties to which the licensee discloses the information, and states that the consumer can opt out of the disclosure of that information; and (3-31-22)

   b. Identifies the insurance products or services that the consumer obtains from the licensee to which the opt out direction would apply. (3-31-22)

3. Reasonable Means to Exercise an Opt Out Right. A licensee provides a reasonable means to exercise an opt out right if it: (3-31-22)

   a. Designates check-off boxes in a prominent position on the relevant forms with the opt out notice; (3-31-22)

   b. Includes a reply form together with the opt out notice; (3-31-22)

   c. Provides an electronic means to opt out, if the consumer agrees to the electronic delivery of information; or (3-31-22)

   d. Provides a toll-free telephone number that consumers may call to opt out. (3-31-22)

IDAPA 18.01.01.251 - Providing Opt Out Notice To Consumers And Complying With Opt Out¶

DIRECTION.

1. Joint Relationships. If two (2) or more consumers jointly obtain an insurance product or service from a licensee, the licensee may provide a single opt out notice providing any of the joint consumers to exercise the right to opt out. The licensee may either: (3-31-22)

   a. Treat an opt out direction by a joint consumer as applying to all of the associated joint consumers; or (3-31-22)

   b. Permit each joint consumer to opt out separately. (3-31-22)

   c. A licensee cannot require all joint consumers to opt out before it implements any opt out direction. (3-31-22)

2. Time to Comply with Opt Out. A licensee will comply with a consumer's opt out direction as soon as reasonably practicable after the licensee receives it. (3-31-22)

3. Continuing Right to Opt Out. A consumer may exercise the right to opt out at any time. (3-31-22)

4. Duration of Consumer's Opt Out Direction. (3-31-22)

   a. A consumer's direction to opt out under Sections 250 and 251 is effective until the consumer revokes it in writing or, if the consumer agrees, electronically. (3-31-22)

   b. If the individual subsequently establishes a new customer relationship with the licensee, the opt out direction that applied to the former relationship does not apply to the new relationship. (3-31-22)

5. Delivery. When a licensee is prescribed to deliver an opt out notice by Section 250, the licensee will deliver it according to Section 350. (3-31-22)

IDAPA 18.01.01.300 - Revised Privacy Notices¶

1. General Rule. A licensee will not disclose any nonpublic personal financial information other than as described in the initial notice that the licensee provided to that consumer under Section 100, unless: (3-31-22)

   a. The licensee has provided to the consumer a clear and conspicuou s revised notice that accurately describes its policies and practices; (3-31-22)

   b. The licensee has provided to the consumer a new opt out notice; (3-31-22)

   c. The licensee has given the consumer a reasonable opportunity, before the licensee discloses the information to the nonaffiliated third party, to opt out of the disclosure; and (3-31-22)

   d. The consumer does not opt out. (3-31-22)

IDAPA 18.01.01.350 - Delivery¶

1. How to Provide Notices. A licensee will make available any notices that this rule requires so that each consumer can reasonably be expected to receive actual notice in writing or, if the consumer agrees, electronically. (3-31-22)

2. Reasonable Expectation of Notice. A licensee may reasonably expect that a consumer will receive actual notice if the licensee: (3-31-22)

   a. Hand-delivers a printed copy of the notice to the consumer; (3-31-22)

   b. Mails a printed copy of the notice to the last known address of the consumer separately, or in a policy, billing or other written communication; or (3-31-22)

   c. For a consumer who conducts transactions electronically, or an isolated transaction with a consumer, such as the licensee providing an insurance quote or selling the consumer travel insurance, posts the notice on the electronic site and requires the consumer to acknowledge receipt of the notice as a necessary step to obtaining a particular insurance product or service. (3-31-22)

3. Annual Notices Only. A licensee may reasonably expect that a customer will receive actual notice of the licensee's annual privacy notice if: (3-31-22)

   a. The customer uses the licensee's web site to access insurance products and services electronically and agrees to receive notices at the web site and the licensee posts its current privacy notice continuously in a clear and conspicuous manner on the web site; or (3-31-22)

   b. The customer has requested that the licensee refrain from sending any information regarding the customer relationship, and the licensee's current privacy notice remains available to the customer upon request. (3-31-22)

4. Oral Description of Notice Insufficient. A licensee cannot provide any notice prescribed by this rule solely by orally explaining the notice. (3-31-22)

5. Retention or Accessibility of Notices for Customers. (3-31-22)

   a. For customers only, a licensee will provide all notices so that the customer can retain them or obtain them later in writing or, if the customer agrees, electronically. (3-31-22)

   b. Examples of retention or accessibility. A licensee provides a privacy notice to the customer so that the customer can retain it or obtain it later if the licensee: (3-31-22)

   i. Hand-delivers a printed copy of the notice to the customer; (3-31-22)
   
   ii. Mails a printed copy of the notice to the last known address of the customer; or (3-31-22)
   
   iii. Makes its current privacy notice available on a web site (or a link to another web site) for the customer who obtains an insurance product or service electronically and agrees to receive the notice at the web site. (3-31-22)
   

6. Joint Notice with Other Financial Institutions. A licensee may provide a joint notice from the licensee and one (1) or more of its affiliates or other financial institutions, as identified in the notice, as long as the notice is accurate with respect to the licensee and the other institutions. A licensee also may provide a notice on behalf of another financial institution. (3-31-22)

IDAPA 18.01.01.400 - Limits On Disclosure Of Nonpublic Personal Financial Information To¶

NONAFFILIATED THIRD PARTIES.

1. Conditions for Disclosure. (3-31-22)

   a. Except as authorized in this rule, a licensee will not, directly or through any affiliate, disclose any nonpublic personal financial information about a consumer to a nonaffiliated third party unless: (3-31-22)

   i. The licensee has provided to the consumer an initial notice as prescribed under Section 100; (3-31-22)
   
   ii. The licensee has provided to the consumer an opt out notice as prescribed in Sections 250 and 251; (3-31-22)
   
   iii. The licensee has given the consumer a reasonable opportunity to opt out of the disclosure before it discloses the information to the nonaffiliated third party; and (3-31-22)
   
   iv. The consumer does not opt out. (3-31-22)
   

   b. If a consumer opts out, the licensee cannot disclose nonpublic personal financial information about that consumer to a nonaffiliated third party, other than as permitted by Sections 450, 451, and 452. (3-31-22)

   c. Examples of a reasonable opportunity to opt out. A licensee provides a consumer with a reasonable opportunity to opt out if the licensee mails the notices prescribed in Subsection 400.01 of this rule to the consumer and allows the consumer to opt out by mailing a form, calling a toll-free telephone number, or any other reasonable means in thirty (30) days from the date of mailing. (3-31-22)

2. Application of Opt Out to All Consumers and All Nonpublic Personal Financial Information. (3-31-22)

   a. A licensee will comply with Section 400, regardless of whether the licensee and the consumer have established a customer relationship. (3-31-22)

   b. Unless a licensee complies with Section 400, the licensee will not disclose any nonpublic personal financial information about a consumer that the licensee has collected, regardless of whethe r the licensee collected it before or after receiving the direction to opt out from the consumer. (3-31-22)

3. Partial Opt Out. A licensee may allow a consumer to select certain nonpublic personal financial information or certain nonaffiliated third parties with respect to which the consumer wishes to opt out. (3-31-22)

IDAPA 18.01.01.401 - Limits On Redisclosure And Reuse Of Nonpublic Personal Financial¶

INFORMATION.

1. Information the Licensee Receives Under an Exception. If a licensee receives nonpublic personal financial information from a nonaffiliated financial institution, the licensee may disclose the information only: (3-31-22)

   a. To the affiliates of the financial institution from which the licensee received the information; and (3-31-22)

   b. To its affiliates, but its affiliates may, in turn, disclose the information only to the extent that the licensee may disclose the information. (3-31-22)

2. Information a Licensee Discloses Under an Exception. If a licensee discloses nonpublic personal financial information to a nonaffiliated third party, the third party may disclose that information only: (3-31-22)

   a. To the licensee's affiliates; (3-31-22)

   b. To the third party's affiliates, but the third party's affiliates, in turn, may disclose the information only to the extent the third party can disclose the information; and (3-31-22)

   c. To any other person, if the disclosure would be lawful if the licensee made it directly to that person. (3-31-22)

IDAPA 18.01.01.402 - Limits On Sharing Account Number Information For Marketing Purposes¶

A licensee will not, directly or through an affiliate, disclose, other than to a consumer reporting agency, a policy number or similar form of access number or access code for a consumer's policy or transaction account to any nonaffiliated third party for use in telemarketing, direct mail marketing or other marketing through electronic mail to the consumer. (3-31-22)

IDAPA 18.01.01.450 - Exception To Opt Out Requirements For Disclosure Of Nonpublic Personal¶

FINANCIAL INFORMATION FOR SERVICE PROVIDERS AND JOINT MARKETING.

1. General Rule. (3-31-22)

   a. The opt out requirements in Sections 250, 251 and 400 do not apply when a licensee provides nonpublic personal financial information to a nonaffiliated third party to perform services for the licensee or functions on the licensee's behalf, if the licensee: (3-31-22)

   i. Provides the initial notice in accordance with Section 100; and (3-31-22)
   
   ii. Enters into a contractual agreement with the third party that prohibits the third party from disclosing or using the information other than to carry out the purposes for which the licensee disclosed the information, including use under an exception in Section 451 or 452 in the ordinary course of business to carry out those purposes. (3-31-22)
   

IDAPA 18.01.01.451 - Exceptions To Notice And Opt Out Requirements For Disclosure Of¶

NONPUBLIC PERSONAL FINANCIAL INFORMATION FOR PROCESSING AND SERVICING TRANSACTIONS.

1. Exceptions. The requirements for initial notice in Paragraph 100.01.b., the opt out in Sections 250, 251, and 400, and service providers and joint marketing in Section 450 do not apply if the licensee discloses nonpublic personal financial information as necessary to effect, administer or enforce a transaction that a consumer requests or authorizes, or in connection with: (3-31-22)

   a. Servicing or processing an insurance product or service that a consumer requests or authorizes; (3-31-22)

   b. Maintaining or servicing the consumer's account with a licensee, or with another entity as part of a private label credit card program or other extension of credit on behalf of such entity; (3-31-22)

   c. A proposed or actual securitization, secondary market sale (including sales of servicing rights) or similar transaction related to a transaction of the consumer; or (3-31-22)

   d. Reinsurance or stop loss or excess loss insurance. (3-31-22)

IDAPA 18.01.01.452 - Other Exceptions To Notice And Opt Out Requirements For Disclosure Of¶

NONPUBLIC PERSONAL FINANCIAL INFORMATION.

1. Exceptions to Opt Out Requirements. The requirements for initial notice to consumers in Paragraph 100.01.b., the opt out in Sections 250, 251, and 400, and service providers and joint marketing in Section 450 do not apply when a licensee discloses nonpublic personal financial information: (3-31-22)

   a. With the consent or at the direction of the consumer; (3-31-22)

   b. To protect the confidentiality or security of a licensee's records pertaining to the consumer, service, product or transaction; (3-31-22)

   c. To protect against or prevent actual or potential fraud or unauthorized transactions; (3-31-22)

   d. For prescribed institutional risk control or for resolving consumer disputes or inquiries; (3-31-22)

   e. To persons holding a legal or beneficial interest relating to the consumer; or (3-31-22)

   f. To persons acting in a fiduciary or representative capacity on behalf of the consumer; (3-31-22)

   g. To provide information to insurance rate advisory organizations, guaranty funds or agencies, agencies rating a licensee, persons assessing the licensee's compliance with industry standards, and the licensee's attorneys, accountants and auditors; (3-31-22)

   h. To the extent specifically permitted or prescribed under other provisions of law and in accordance with the federal Right to Financial Privacy Act of 1978 (12 U.S.C. 3401 et seq.), to law enforcement agencies (including the Federal Reserve Board, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, Office of Thrift Supervision, National Credit Union Administration, the Securities and Exchange Commission, the Secretary of the Treasury, and the Federal Trade Commission), with respect to 31 U.S.C. Chapter 53, Subchapter II (Records and Reports on Monetary Instruments and Transactions) and 12 U.S.C. Chapter 21 (Financial Recordkeeping), a state insurance authority, self-regulatory organizations or for an investigation on a matter related to public safety; (3-31-22)

   i. To a consumer reporting agency in accordance with the federal Fair Credit Reporting Act (15 U.S.C. 1681 et seq.); or from a consumer report reported by a consumer reporting agency; (3-31-22)
   

   j. In connection with a proposed or actual sale, merger, transfer, or exchange of all or a portion of a business or operating unit if the disclosure of nonpublic personal financial information concerns solely consumers of the business or unit; (3-31-22)

   k. To comply with federal, state or local laws, rules, and other applicable legal requirements; to comply with a properly authorized civil, criminal, or regulatory investigation, or subpoena or summons by federal, state or local authorities; or to respond to judicial process or government regulatory authorities having jurisdiction over a licensee for examination, compliance, or other purposes as authorized by law; (3-31-22)

   l. For purposes related to the replacement of a group benefit plan, a group health plan, a group welfare plan or a workers' compensation plan; or (3-31-22)

   m. With the consent of or at the direction of a liquidator or rehabilitator appointed pursuant to Chapter 33, Title 41, Idaho Code. (3-31-22)

IDAPA 18.01.01.500 - Nondiscrimination¶

A licensee will not unfairly discriminate against any consumer or customer because that consumer or customer has opted out from the disclosure of their nonpublic personal financial information pursuant to the provisions of this rule. (3-31-22)

IDAPA 18.02.01¶

IDAPA 18.02.01.000 - Legal Authority¶

Title 41, Sections 41-211 and 41-1843, Idaho Code. (3-31-22)

IDAPA 18.02.01.001 - Scope¶

This rule relates to the use of credit rating or credit history by insurers subject to said sections. (3-31-22)

IDAPA 18.02.01.010 - Definitions¶

As used in this chapter, the following words have the following meanings: (3-31-22)

1. Consumer Report. Any written, oral, or other communication of any information by a consumer reporting agency regulated under the federal Fair Credit Reporting Act (15 U.S.C. 1681) that bears on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living. (3-31-22)

2. Credit Factor. A factor or criterion that consists of or is derived from information obtained from a consumer report, and is used by an insurer in determining policy premium rates or in determining whether to issue, cancel, or nonrenew a policy. (3-31-22)

3. Noncredit Factor. Any factor other than a credit factor reasonably expected to affect the risk assumed by an insurer and used by the insurer in determining policy premium rates, or in determining whether to issue, cancel or nonrenew a policy. (3-31-22)

IDAPA 18.02.01.100 - Use Of Credit Factors¶

1. Application of Statute. To determine whether a decision is not improperly based primarily upon a credit factor or factors, the Department will apply the following criteria: (3-31-22)

   a. If an insurer declines to issue, nonrenews or cancels a policy based in any part upon a credit factor, then the insurer will maintain records demonstrating noncredit factors played a greater role in the decision than credit factors. (3-31-22)

   b. If an insurer relies in any part upon a credit factor to establish an initial rate or to impose an increase in premium rate for a customer, then the insurer is to ensure the premium rate using the highest credit factor does not exceed twice the premium using the lowest credit factor, all noncredit factors being unchanged and notwithstanding any optional coverage. (3-31-22)

2. Information For Review. To evaluate whether a decision was based primarily upon credit factors, the insurer will have on file with the Department, in a manner approved by the Director, an attestation that rate, issuance, non-renewal, and cancellation decisions are not primarily based on credit factors, and that the rating is compliant with Paragraph 100.01.b. of this rule. The insurer's filing will support the attestation by providing the details of the rating process, including an explanation of all factors considered in the rating process and how the process is applied. The Department may also request the insurer apply its rating process to hypothetical cases. (3-31-22)

IDAPA 18.02.01.201 - Retention Of Records¶

Insurers subject to this rule will document the factors and criteria considered in underwriting and rating decisions and will retain the documentation for at least five (5) years. (3-31-22)

IDAPA 18.03.02¶

IDAPA 18.03.02.000 - Legal Authority¶

Sections 41-211 and 41-1965, Idaho Code. (7-1-25)

IDAPA 18.03.02.001 - Scope¶

This rule sets forth requirements regarding the sale and settlement of life insurance contracts where the owner of the contract is an Idaho resident, consistent with Sections 41-1950 through 41-1965, Idaho Code. (7-1-25)

IDAPA 18.03.02.010 - Definitions¶

In addition to the definitions found in Section 41-1951, Idaho Code, the following apply: (7-1-25)

1. Affiliation. Any contractual relationship outside of the proposed life settlement contract, any ownership interest or relation, any familial relation, an employment relation, any relationship creating financial dependency, any arrangement that provides one party the ability to control or influence the actions of another party, or any other arrangement or relationship that might reasonably result in parties treating one another in a less than arm's length manner. (3-31-22)

2. Registration. The process completed by a broker or provider pursuant to Section 41-1952, Idaho Code. (7-1-25)

IDAPA 18.03.02.011 - Renewal Of Registration To Operate As Life Settlement Provider Or Life¶

SETTLEMENT BROKER. Registration as a broker or provider continues until the next renewal date of the person's producer license. If the initial registration takes place within ninety (90) calendar days from the producer license expiration date, registration will continue until the following producer license renewal date. Registration may be renewed by payment of the applicable renewal fee as set forth at IDAPA 18.01.02. An insurance producer who allows their registration as a broker or provider to lapse may, within twelve (12) months from the renewal due date, reinstate the registration by paying a penalty in the amount of double the unpaid renewal fee. If a registration is allowed to lapse for more than twelve (12) months without reinstatement, a producer wishing to act a broker or provider will re-register with the Department and pay the applicable registration fee prior to operating as a broker or provider. (7-1-25)

IDAPA 18.03.02.012 - Filing Of Advertising Materials¶

1. Filing of Advertising Materials. No person may use advertising materials promoting or advertising the availability of life settlements or life settlement services in Idaho unless the materials are first filed with the Department. If the advertising is not in written form, a written script will be filed. All advertising relating to the business of life settlements will have a unique identifying form number in the lower left-hand corner of the advertising piece and needs to comply the following standard s: (3-31-22)

   a. Be truthful and not misleading in fact and implication. All information is set out conspicuously and in close conjunction with the statements and will not be minimized, rendered obscure, ambiguous, or intermingled with the context of the advertisement so as to be confusing or misleading. (3-31-22)

   b. Reference the complete form number of any life settlement contract being advertised and clearly identify the full and complete name of the provider or broker using the promotional material. Advertising materials cannot use a trade name, any insurance group designation, name of the parent company of the provider or broker, name of a particular division of the provider or broker, service mark, slogan, symbol or other device which would have the capacity and tendency to mislead or deceive as to the true identity of the provider or broker without disclosing the name of the actual provider or broker using the advertising material. (3-31-22)

   c. No advertisement will omit information or use words, phrases, statements, references or illustrations if the omission of such information or use of such words, phrases, statements, references or illustrations has the capacity, tendency or effect of misleading or deceiving sellers or prospective sellers as to the nature or extent of any policy benefit payable. The fact that the contract offered is made availa ble to a prospective seller for inspection prior to consummation of the sale or an offer is made to rescind the life settlement contract if the seller is not satisfied, does not remedy misleading statements. (3-31-22)

   d. Advertising materials cannot use words or phrases in a manner which exaggerates any benefits beyond the terms of the life settlement contract and fairly and accurately describe the negative features as well as the positive features of the life settlement contract and life settlement program. An advertisement cannot represent or imply that life settlements by the provider are "liberal" or "generous," or use words of similar import, or that benefits of a life settlement are or will be beyond the actual terms of the life settlement contract. (3-31-22)

   e. Advertising materials cannot be designed to encourage or promote the purchase of life insurance for the purpose of transferring ownership to third party investors who lack an insurable interest in the in the life of the insured. (3-31-22)

   f. An advertisement cannot create the impression directly or indirectly that a provider, a broker, its financial condition or status, a life settlement contract or program, or the payment of life settlement benefits is approved, endorsed, or accredited by any division or agency of this state or the United States Government. (3-31-22)

   g. Testimonials used in advertisements needs to be genuine, represent the current opinion of the author, be applicable to the life settlement contract advertised and be accurately reproduced. A provider or broker using a testimonial makes as its own all of the statements contained therein, and the advertisement, including such statement, is subject to all the provisions of these rules. If the person making a testimonial, an endorsement or an appraisal has a financial interest in the provider or broker, or a related entity as a stockholder, director, officer, employee, or otherwise, such fact is disclosed in the advertisement. If a person is compensated for making a testimonial, endorsement or appraisal, such fact will be disclosed in the advertisement by language substantially as follows: "Paid Endorsement." (3-31-22)

   h. The source of any statistics used in an advertisement are identified in the advertisement. (3-31-22)

2. Font Size for Printed Materials. Pertinent text of all printed materials needs to be filed with the director under the Life Settlement Act, including, but not limited to, notices, disclosure forms, contract forms, and advertising material, is to be formatted using at least a twelve (12) point font. Signature blocks, footnotes or text not relevant to the understanding of the printed material may be printed in a smaller font, but in no case smaller than a ten

       (10) point font. (3-31-22)
   

3. Disapproval of Noncompliant Forms. The Director may disapprove any form needed to be filed pursuant to this Section if, the form does not comply with any part of Title 41, Idaho Code, or these rules, or the form is unreasonable in its terms, contrary to the interests of the public, misleading to the public, unfair to the owner, or is printed or provided in a manner making any part of the form substantially illegible. (3-31-22)

IDAPA 18.03.02.014 - Examination And Records¶

Brokers and providers are subject to examination by the Director in accordance with Title 41, Chapter 2, Idaho Code, and pay, at the direction of the Director, the actual travel expenses, reasonable living expense allowance, and reasonable compensation incurred on account of the examination upon presentation of a detailed account of the charges and expenses. (3-31-22)

IDAPA 18.03.02.015 - Affiliation Disclosure To Owner¶

As a part of any disclosure pursuant to Section 41-1956, 41-1957, or 41-1958, Idaho Code, a provider discloses in writing to the owner any affiliation between the provider and the issuer of the insurance policy to be settled, and a broker discloses in writing any affiliation or contractual arrangement between the broker and any person making an offer in connection with a proposed life settlement contract. (7-1-25)

IDAPA 18.03.02.016 - Additional Requirements¶

1. Owner's Statement. (3-31-22)

   a. Prior to entering into a life settlement contract, the provider obtains from each owner a written statement in substantially the following form: "I, [owners name], have freely and voluntarily consented to the life settlement contract that accompanies this statement. I have carefully read my insurance policy that is the subject of the life settlement contract and I understand the benefits that are available under the policy. I further understand that by entering into the life settlement contract, the right to benefits under the insurance policy will be sold to another party and I, my heirs or former beneficiaries will no longer have any right to receive those policy benefits." (3-31-22)

   b. If the owner has a terminal or chronic illness, the following wording is also to be included in the owner's statement: "I am currently suffering from a terminal or chronic illness that was not diagnosed until after the policy that is the subject of the life settlement contract was issued." (3-31-22)

   c. The statement of the owner needs to also be acknowledged by a notary public. (3-31-22)

2. Owner's Right to Rescind Life Settlement Contract. (3-31-22)

   a. The life settlement contract is to conspicuously inform the owner in bold type of at least twelve

       (12) point font that the owner has an absolute right to rescind a life settlement contract within twenty (20) calendar days of the date the contract is executed and sets forth the manner in which notice is given. (3-31-22)
   

   b. Upon being informed of the owner's intention or desire to rescind a life settlement contract, the provider immediately provides the owner with a full accounting of the amount that will be repaid by the owner to rescind the policy. The amount due includes only am ounts actually paid to and received by the owner pursuant to the terms of the life settlement contract along with any premiums, loans and loan interest paid by or on behalf of the provider in connection with or as a direct consequence of the life settlement contract. An owner is not obligated to pay any financial penalties, liquidated damages or other punitive fees or charges in connection with rescission of a life settlement contract. (7-1-25)

   c. Until the owner receives from the provider an accounting of the full and correct repayment amount needed to rescind the life settlement contract, a tender of payment by the owner of amounts actually received and reasonably believed to be due upon rescission will be deemed in substantial compliance with the requirement of notice and repayment of proceeds within the twenty (20) day rescission period. (3-31-22)

3. Life Settlements Occurring Within Two Years of Policy Origination. (3-31-22)

   a. If one (1) or more of the conditions in Section 41-1961, Idaho Code, is present, the provider obtains from the owner a written statement sworn before a notary public setting forth in detail the circumstances permitting the early settlement of the contract. The sworn statement also includes the following or substantially similar wording: "I hereby affirm that there was no plan or arrangement in place or under discussion, or any promises made, regarding the settlement of this life insurance policy at the time the policy was purchased." (7-1-25)

   b. In addition to the sworn statement, the provider will obtain and retain as a part of its records independent documentation of the circumstances permitting early settlement of the life insurance policy along with all documentation relating to any premium financing arrangements made in connection with the policy being settled. (3-31-22)

   c. The sworn statement and copies of all supporting documentation will be provided to the insurer at the time a request for verification of coverage is submitted to the insurer. A request for verification of coverage relating to a policy or certificate that has been in effect for two (2) years or less will be considered incomplete if it is not accompanied by the owner's sworn statement and supporting documentation. An insurer that determines a request for verification of coverage is incomplete will immediately inform the broker or provider in writing that the verification is incomplete and identify all items needed to complete the request. (3-31-22)

IDAPA 18.03.04¶

IDAPA 18.03.04.000 - Legal Authority¶

Title 41, Chapter 13, Sections 1305 and 1327, Idaho Code. (3-31-22)

IDAPA 18.03.04.001 - Title And Scope¶

This rule regulates the activities of insurers, agents and brokers with respect to the replacement of existing life insurance and annuities, and establishes minimum standards of conduct. (3-31-22)

IDAPA 18.03.04.010 - Definitions¶

1. Conservation. Any attempt by the existing insurer or its agent or broker to dissuade a policy owner from the replacement of existing life insurance or annuity. Conservation does not include such routine administrative procedures such as late payment reminders, late payment offers or reinstatement offers. (3-31-22)

2. Direct-Response Sales. Any sale of life insurance or annuity where the insurer does not utilize an agent in the sale or delivery of the policy. (3-31-22)

3. Existing Insurer. The insurance company whose policy is or will be changed or terminated in such a manner as described in the definition of "repl acement." (3-31-22)

4. Existing Life Insurance or Annuity. Any life insurance or annuity in force, including life insurance under a binding or conditional receipt or a life insurance policy or annuity that is in an unconditional refund period. (3-31-22)

5. Replacement. Any transaction by which new life insurance or a new annuity is to be purchased, and it is known or should be known to the proposing agent or broker, or to the proposing insurer if there is no agent, that existing life insurance or an annuity has been or is to be: (3-31-22)

   a. Termination. Lapsed, forfeited, surrendered, or otherwise terminated. (3-31-22)

   b. Conversion or Continuance. Converted to reduced paid-up insurance, continued as extended term insurance, or reduced in value by the use of nonforfeiture benefits or other policy values. (3-31-22)

   c. Amendment. Amended so as to effect either a reduction in benefits or in the term for which coverage would remain in force or for which benefits would be paid. (3-31-22)

   d. Reissuance. Reissued with any reduction in cash value. (3-31-22)

   e. Loans. Pledged as collateral or subjected to borrowing, whether in a single loan or under a schedule of borrowing over a period of time for amounts in the aggregate exceeding twenty-five percent (25%) of the loan value set forth in the policy. (3-31-22)

6. Replacing Insurer. The insurance company that issues or proposes to issue a new policy or contract which is a replacement of existing life insurance or annuity. (3-31-22)

IDAPA 18.03.04.011 - Exemptions¶

Unless specifically included, this rule does not apply to transactions involving: (3-31-22)

1. Credit Life Insurance. (3-31-22)

2. Group Life Insurance or Group Annuities. (3-31-22)

3. Existing Insurer. An application to the insurer that issued the existing life insurance and a contractual change or conversion privilege being exercised; (3-31-22)

4. Binding or Conditional Receipt Issued by Same Company. Proposed life insurance that is to replace life insurance under a binding or conditional receipt issued by the same company. (3-31-22)

5. Common Ownership or Control. Transactions where the replacing insurer and the existing insurer are the same, or are subsidiaries or affiliates under common ownership or control. Provided, however, agents or brokers proposing replacement will comply with the requirements of Subsection 012.01. (3-31-22)

IDAPA 18.03.04.012 - Duties Of Agents And Brokers¶

1. Statement Submitted to Insurer. Each agent or broker who initiates the application submits to the insurer to which an application for life insurance or annuity is presented, with or as part of each application: (3-31-22)

   a. A statement signed by the applicant as to whether replacement of existing life insurance or annuity is involved in the transaction; and (3-31-22)

   b. A signed statement as to whether the agent or broker knows replacement is or may be involved in the transaction. (3-31-22)

2. Notice to Applicant. Where a replacement is involved, the agent or broker will: (3-31-22)

   a. Present to the applicant, not later than at the time of taking the application, a "Notice Regarding Replacement" in the form as described on the DOI website, or other substantially similar form approved by the Director. The notice is signed by both the applicant and the agent or broker and left with the applicant. (3-31-22)

   b. Obtain with or as part of each application a list of all existing life insurance and/or annuities replaced and properly identified by name of insurer, the insured and contract number. If a contract number has not been assigned by the existing insurer, alternative identification, such as an application or receipt number, is listed. (3-31-22)

   c. Leave with the applicant the original or a copy of written or printed communications used for presentation to the applicant. (3-31-22)

   d. Submit to the replacing insurer with the application a copy of the replacement notice provided pursuant to Subsection 012.02.a. (3-31-22)

3. Conservation. Each agent or broker who uses written or printed communications in a conservation will leave with the applicant the original or a copy of such materials used. (3-31-22)

IDAPA 18.03.04.013 - Duties Of All Insurers¶

Each insurer will: (3-31-22)

1. Notice to Representatives of Rule. Informs its field representatives or other personnel responsible for compliance with this rule of the requirements of this rule. (3-31-22)

2. Application. Requires with or as a part of each completed application for life insurance or annuity a statement signed by the applicant as to whether such proposed insurance or annuity will replace existing life insurance or annuity. (3-31-22)

IDAPA 18.03.04.014 - Duties Of Insurers That Use Agents Or Brokers¶

Each insurer that uses an agent or broker in a life insurance or annuity sale: (3-31-22)

1. Statement by Agent or Broker. With or as part of each completed application for life insurance or annuity, obtains a statement signed by the agent or broker as to whether he or she knows if replacement is involved in the transaction. (3-31-22)

2. Replacement Notice and List of Existing Insurance. Where a replacement is involved: (3-31-22)

   a. With the application for life insurance or annuity, obtains a list of all of the applicant's existing life insurance or annuities replaced and a copy of the replacement notice provided the applicant pursuant to Section 012. Such existing life insurance or annuity is identified by name of insurer, insured and contract number. If a number has not been assigned by the existing insurer, alternative identification, such as an ap plication or receipt number, is listed. (3-31-22)

   b. Send to each existing insurer a written communication advising of the replacement or proposed replacement and the identification information obtained pursuant to Subsection 014.02.a. and a policy summary or ledger statement containing policy data on the proposed life insurance or annuity as prescribed by the model life insurance solicitation rule and/or the model annuity and deposit fund disclosure rule. Life insurance cost index and equivalent level annual dividend figures need not be included in the policy summary or ledger statement. This written communication is made in five (5) working days of the date the application is received in the replacing insurer's home or regional office, or the date the proposed policy or contract is issued, whichever is sooner. (3-31-22)

   c. Each existing insurer, agent, or broker that undertakes a conservation furnishes the policy owner with a policy summary for the existing life insurance or a ledger statement containing policy data on the existing policy and/or annuity within twenty (20) days from the date the written communication and the materials described in Subsections 014.02.a. and 014.02.b. are received. Such policy summary or ledger statement is completed in accordance with information relating to premiums, cash values, death benefits and dividends, if any, and is computed from the current policy year of the existing life insurance. The policy summary includes the amount of any outstanding indebtedness, the sum of any dividend accumulations or additions, and may include any other information that is not in violation of any rule or statute. Life insurance cost index and equivalent level annual dividend figures need not be included in the policy summary. When annuities are involved, the disclosure information is requisite in a contract summary under the annuity and deposit fund disclosure rule. The replacing insurer may request the existing insurer to furnish it with a copy of the summaries. (3-31-22)

3. Maintenance of Records. The replacing insurer maintains evidence of the "Notice Regarding Replacement," the policy summary, the contract summary and any ledger statements used, and a replacement register, cross indexed, by replacing agent and existing insurer to be replaced. The existing insurer maintains evidence of policy summaries, contract summaries or ledger statements used in any conservation. Evidence that all requirements were met are maintained for at least three (3) years or until the conclusion of the next succeeding regular examination by the insurance department of its state of domicile, whichever is later. (3-31-22)

4. Refund. The replacing insurer provides in its policy or in a separate written notice which is delivered with the policy that the applicant has a right to an unconditional refund of all premiums paid, which right may be exercised in a period of twenty (20) days commencing from the date of delivery of the policy. (3-31-22)

IDAPA 18.03.04.015 - Duties Of Insurers With Respect To Direct Response Sales¶

1. Insurer Did Not Propose Replacement. If in the solicitation of a direct response sale, the insurer did not propose the replacement, and a replacement is involved, the insurer will propose to send to the applicant with the policy a Replacement Notice as described on the DOI website or other substantially similar form approved by the Director. (3-31-22)

2. Insurer Proposed Replacement. If the insurer proposed the replacement it will: (3-31-22)

   a. Provide to applicants or prospective applicants with or as part of the application a replacement notice as described on the DOI website or other substantially similar form approved by the Director. (3-31-22)

   b. Request from the applicant with or as part of the application, a list of all existing life insurance or annuities replaced and properly identified by name of insurer and insured. (3-31-22)

   c. Comply with the requirements of Subsection 014.02.b., if the applicant furnishes the names of the existing insurers, and the requirements of Subsection 014.03, except that it need not maintain a replacement register. (3-31-22)

IDAPA 18.03.04.016 - Penalties¶

Failure by an insurer, agent, representative, officer, or employee of such insurer to comply with the requirements of this rule is subject to such penalties as may be appropriate under the Idaho Code, including Section 41-1327, Idaho Code. (3-31-22)

IDAPA 18.06.01¶

IDAPA 18.06.01.000 - Legal Authority¶

Sections 41-211 and 41-1037 through 41-1045, Idaho Code. (7-1-24)

IDAPA 18.06.01.001 - Scope¶

The provisions of this rule apply to all bail agents, as defi ned by Section 41-1038, Idaho Code. This rule is supplementary to other rules and laws regulating insurance producers, and all other rules of the Department and provisions of Title 41, Idaho Code, applicable to insurance producers apply to bail agents. (7-1-24)

IDAPA 18.06.01.012 - Notification Requirements¶

1. Notice of Changes. A bail agent licensed pursuant to Section 41-1039, Idaho Code, will immediately notify the Department in writing of any the following: (7-1-24)

   a. Change of bail agent's name, current business address, or current business phone number or business e-mail address; (7-1-24)

   b. Change of name or address of any surety insurance company for which the bail agent has an active appointment; (7-1-24)

   c. Cancellation by a surety insurance company of a bail agent's authority to write bonds for that company; (7-1-24)

   d. Any new affiliation with a bail bond agency; (7-1-24)

   e. Cancellation of a bail agent's affiliation with a bail agency; (7-1-24)

2. Notice of Legal Proceedings or Judgments. (7-1-24)

   a. A bail agent will provide immediate written notice to the Department of the filing of any criminal charges or judgments against the bail agent, and of any material change in circumstances that would require a different answer than previously provided by the bail agent on the background information section of the Uniform Application for Individual Insurance Producer License/Registration. (7-1-24)

   b. For the purpose of determining whether grounds for immediate suspension of a bail agent's license exist under Section 41-1039(4), Idaho Code, a withheld judgment or a plea of nolo contendere is considered the same as a conviction or guilty plea. (7-1-24)

IDAPA 18.06.01.013 - Background Checks¶

All licensed bail agents will be subject to a criminal background check in connection with the renewal of a bail agent's license and will bear all costs associated with the background check. (7-1-24)

IDAPA 18.06.01.014 - Stacking Of Bonds¶

A bail agent may submit only one (1) power of attorney with each bail bond submitted to any Idaho court. The face value or face amount of the power of attorney will be equal to or greater than the amount of the bond. (7-1-24)

IDAPA 18.06.01.015 - Notification To Surety Of Forfeiture¶

A bail agent will notify the surety insurance company of any forfeiture, as defined in Section 19-2905, Idaho Code, within ten (10) days of receiving the notice from the court. (7-1-24)

IDAPA 18.06.01.017 - Bail Agent Financing Of Bail Bond Premiums¶

1. Written Agreement. No credit may be extended by any bail agent or surety insurance company for the payment of any bail bond premium without entering into a written agreement. The written agreement for the extension of credit to finance premium need to contain at a minimum the following: (7-1-24)

   a. The name, signatures, and dates of signatures of all parties to the credit agreement; (7-1-24)

   b. The amount of premium financed; (7-1-24)

   c. The per annum rate of interest; and (7-1-24)

   d. The scheduled premium payment dates. (7-1-24)

2. Interest. A bail agent or surety insurance company that extends credit for premium payments at zero percent (0%) interest for more than ninety (90) days is in violation of Section 41-1314(4), Idaho Code. (7-1-24)

3. Collateral for Credit Agreement. In any collateralized credit agreement the collateral will be separate and apart from any collateral used in the bail bond transaction, will be described in the credit agreement or in an attachment to the agreement, and will be handled in accordance with Section 41-1043, Idaho Code. (7-1-24)

IDAPA 18.06.01.018 - Payment Of Forfeiture¶

Failure to pay a claim for forfeiture by a surety is a violation of Section 41-1329(6), Idaho Code Liability for payment upon forfeiture is considered reasonably clear when payment is due pursuant to Section 19-2918, Idaho Code. (7-1-24)

IDAPA 18.06.02¶

IDAPA 18.06.02.000 - Legal Authority¶

Sections 41-211, 41-1024, 41-1025, 41-1042, and 41-1043, Idaho Code. (7-1-24)

IDAPA 18.06.02.001 - Scope¶

This rule applies to "producers," including bail agents, who handle fiduciary funds. (7-1-24)

IDAPA 18.06.02.010 - Definitions¶

1. Fiduciary Fund Account. A financial account established to hold fiduciary funds as provided in

2. Fiduciary Funds. All premiums, return premiums, premium taxes, funds as collateral, and fees received by a producer. Fiduciary funds include: (7-1-24)

   a. All funds paid to a producer for selling, soliciting or negotiating policies of insurance except for those fees recognized by statute as earned by the producer upon receipt which are payable to the producer and not the insurance company, pursuant to Section 41-1030, Idaho Code. (7-1-24)

   b. All funds received by a producer from or on behalf of a client or premium finance company that are to be paid to an insurance company, its agents, or to the producer's employer. (7-1-24)

   c. All funds provided to a producer by an insurance company or its agents that are to be paid to a policyholder or claimant pursuant to a contract of insurance. (7-1-24)

   d. All checks or other negotiable instruments collected by the producer and made payable to the insurer. (7-1-24)

   e. Cash collateral pursuant to Section 41-1043, Idaho Code. (7-1-24)

3. Receive. To collect or take possession of fiduciary funds. If fiduciary funds are in the form of a credit or offset on an account or other liability for the benefit of the consumer, without the producer actually taking possession of the funds, then constructive receipt is presumed to have occurred. (7-1-24)

IDAPA 18.06.02.014 - Deposit And Remittance Timing¶

1. Payable to an Insurer. Fiduciary funds that are in the form of a check or another negotiable instrument, made payable to an insurer, are to be remitted to the insurer within the time period specified in the producers contract, or if not specified, then within fourteen (14) days of receipt. (7-1-24)

2. Payable to a Policyholder. Fiduciary funds that are in the form of a check or another negotiable instrument made payable to a policyholder or claimant are to be remitted to that person within fourteen (14) days of receipt or as specified by the terms insurance policy language, the insurer, or applicable law. (7-1-24)

3. All Other. All other fiduciary funds received by the producer, except as described under Subsections 014.01 and 014.02 are to be deposited into a fiduciary fund account as follows: (7-1-24)

   a. Cash: within seven (7) days of receipt, except when the amount exceeds two thousand dollars ($2,000), then such funds will be deposited within three (3) business days. (7-1-24)

   b. Checks, money orders, other negotiable instruments, debit or credit card payments, or other electronic funds transfer: within seven (7) days of receipt. (7-1-24)

4. Documentation of Fiduciary Funds. A producer will document the receipt of funds by recording date received, the payee, and the amount received.For cash, including cash collateral, the producer will give the payor a detailed receipt at the time of payment indicating cash was received, date received, amount received, payor's name, payee's name, purpose of payment, and any other information important to the transaction. The producer will maintain the receipt for at least five (5) years. (7-1-24)

IDAPA 18.06.02.015 - Depositing Other Funds In Fiduciary Account-Voluntary Deposits¶

A producer may deposit other additional funds for the sole purpose of: (7-1-24)

1. Reserves. Establishing reserves for payment of return premiums. (7-1-24)

2. Bank Charges. Advancing funds sufficient to pay bank charges. (7-1-24)

3. Contingencies. For any contingencies that may arise in the business of receiving, transmitting or returning premium funds or cash collateral. (7-1-24)

IDAPA 18.06.02.016 - Types Of Permitted Accounts¶

1. Federally Insured. A producer will maintain fiduciary funds only in federally insured accounts. (7-1-24)

2. Investments. If funds held exceed the federally insured limits, then only the excess funds may be deposited into: (7-1-24)

   a. An investment account that invests only in United States government bonds, United States Treasury certificates or in federally guaranteed obligations; or (7-1-24)

   b. Money market mutual funds registered with the SEC which are rated AAA by Moody's S&P. (7-1-24)

3. Designation. A fiduciary fund account is so designated on the records of the financial institution. The account has a separate account number, a separate check register and its own checks displaying "Trust Fund Account" or similar designation on the face of each check. (7-1-24)

4. Interest. The producer will maintain records of any interest accrued. (7-1-24)

5. Affiliated Fiduciary Fund Account. A producer may maintain fiduciary funds in the fiduciary fund account of an affiliated producer. Each producer retains responsibility for compliance. (7-1-24)

IDAPA 18.06.02.019 - Permissible Distribution¶

Distributions from a fiduciary fund account are to only be made for the following purposes, and manner: (7-1-24)

1. Remit Premiums. Remit premiums to an insurer or an insurer's designee pursuant to a contract of insurance; (7-1-24)

2. Return Premiums. Return premiums to an insured or other person or entity entitled to the premiums; (7-1-24)

3. Remit Surplus Lines Taxes and Stamping Fees. Remit surplus lines taxes and stamping fees collected to the appropriate state; (7-1-24)

4. Reimburse Voluntary Deposits. Reimburse voluntary deposits made by the producer to the extent that the funds in the fiduciary account exceed the amount necessary to meet all fiduciary obligations. The reimbursement will be matched to a previous voluntary deposit. (7-1-24)

5. Transfer or Withdraw Accrued Interest. Transfer or withdraw accrued interest to the extent that fiduciary fund account funds exceed the amount necessary to meet all fiduciary obligations. The reimbursement will be matched to a previous interest deposit by the financial institution. (7-1-24)

6. Transfer or Withdraw Commissions. Transfer or withdraw commissions and those earned fees earned by the producer, upon receipt, which are payable to the producer, only if the commissions and fees can be matched with funds previously deposited in the fiduciary account. (7-1-24)

7. Pay Charges Imposed. Pay charges imposed by the financial institution that directly relate to the operation and maintenance of the fiduciary fund account. (7-1-24)

8. Transfer Funds. Transfer funds from one (1) fiduciary fund account to another fiduciary fund account. (7-1-24)

9. Return Cash Collateral. Return cash collateral to the person who deposited the cash collateral with the producer within fourteen (14) days of the date notice is received that the obligation, the satisfaction of which was secured by the cash collateral, has been discharged. (7-1-24)

10. Convert Cash Collateral. Convert cash collateral where the defendant or other responsible party fails to satisfy the obligation of the bail bond and the bail or obligation was not exonerated by the court but instead executed by the court, provided such conversion is compliant with the contract between the producer and the person who deposited the cash collateral. (7-1-24)

IDAPA 18.06.02.022 - Timely Disbursement Of Fiduciary Funds¶

In addition to the requirements of Section 014, after receiving fiduciary funds, a producer: (7-1-24)

1. Remits Premiums. Remits premiums directly to an insurer or an insurer's designee within the time period set forth in the producer's contract, or if not specified, within four teen (14) days of receipt; (7-1-24)

2. Returns Money Received. Returns to the payer the money received as a premium deposit which is retained by the producer or returned to the producer by the insurer to the payer by the earlier of: (7-1-24)

   a. Fourteen (14) days from the date the premium is received by th e producer or (7-1-24)

   b. Fourteen (14) days from the date the insurer notifies the insurance applicant that coverage has been denied if the producer retained the premium deposit. (7-1-24)

3. Refund Received from the Insurer. Issues a refund received from the insurer within fourteen (14) days by disbursing money to the insured or other party entitled thereto. If the producer is applying the refund to an outstanding amount owed by the insured, the producer obtains the insured's permission and provides the insured a detailed description of the amount owed to which the refund is being applied. (7-1-24)

4. Dispute of Entitlement of Funds. If there is a dispute as to entitlement of funds under Subsections 022.01 or 022.03, a producer notifies the parties of the dispute, seeks to resolve it, and documents the steps taken to resolve it. (7-1-24)

5. Funds Held for More Than Ninety Days. If funds within the scope of Subsections 022.01 or 022.03 are held for more than ninety (90) days, the producer investigates to determine the entitlement to fiduciary funds and pays those fiduciary funds when due to the appropriate person in accordance with this section. (7-1-24)

6. Return Cash Collateral. Returns cash collateral to the depositor within fourteen (14) after the obligation is discharged. (7-1-24)

IDAPA 18.06.04¶

IDAPA 18.06.04.000 - Legal Authority¶

Title 41, Chapters 2, 10, 11, and 58, Sections 41-211, 41-1013, 41-1108, 41-5813, and 41-5820, Idaho Code. (3-31-22)

IDAPA 18.06.04.001 - Scope¶

This rule prescribes a minimum education in approved subjects that impacts all resident licensees practicing insurance, except for producers licensed to sell only "limited lines insurance," and requires them to periodically complete, procedures and standards for the approval of such education, and a procedure for establishing that continuing education requirements have been met. (3-31-22)

IDAPA 18.06.04.010 - Definitions¶

1. Licensee. An individual holding a license as a producer, bail, adjuster, or public adjuster pursuant to Title 41, Chapters 10, 11, or 58, Idaho Code. (3-31-22)

IDAPA 18.06.04.012 - Basic Requirements¶

1. Proof of Completion. As a condition for the continuation of a license, a licensee must complete a total of 24 hours of continuing education credits, including a minimum of 3 ethics credits on or before the licensing renewal date every two (2) years. Proof of satisfactory completion of approved subjects or courses will be downloaded to licensing records by the system vendor in a format acceptable to the Director. (3-31-22)

   a. No more than four (4) hours of continuing education credit from courses approved for adjusters or public adjusters can apply toward the continuation of a producer license. (3-31-22)

2. Completion Within Two Years. Each course to be applied toward satisfaction of the continuing education requirement is to be completed within the two (2) year period immediately preceding renewal of the license. Courses cannot have been duplicated in the same renewal period. The date of completion for a self-study course is the date of successful completion of exam. (3-31-22)

IDAPA 18.06.04.013 - Exceptions¶

1. Exceptions and Extensions. The following exceptions and extensions may be made to the continuing education rules: (3-31-22)

   a. Licensees on extended active duty with the Armed Forces of the United States for the period of such duty and all other exceptions allowed under Section 41-1008(4), Idaho Code. (3-31-22)

   b. Persons which hold a temporary license as provided in Section 41-1015, Idaho Code. (3-31-22)

   c. The Continuing Education Advisory Committee or the Director may approve an exception or extension for an extra ordinary situation that is requested by a licensee, in writing, setting forth the basis for the exception or extension. and received prior to the renewal date by the Director or Committee. (3-31-22)

IDAPA 18.06.04.014 - Continuing Education Advi Sory Committee¶

1. Continuing Education Advisory Committee. An eleven (11) member Continuing Education Advisory Committee ("Committee") comprised of representatives from each segment of the insurance industry, is appointed by the Director. Committee members will serve a term of three (3) years. (3-31-22)

2. Duties of the Committee. The Committee performs the following duties at the discretion of the Director: (3-31-22)

   a. Approve or disapprove courses as per the standards of this rule and assign the number of continuing education hours to be awarded. (3-31-22)

   b. Consider applications for exceptions and extensions as permitted under Section 013; and (3-31-22)

   c. Consider other matters as the Director may assign. (3-31-22)

3. Quorum. Those present at any meeting of the Committee are a quorum for purposes of acting to perform the duties of the Committee pursuant to this rule. Matters before the Committee may be decided by a majority of those members present. In the event of a tie vote, the Chairman votes to break the tie. (3-31-22)

IDAPA 18.06.04.015 - Program Requirements¶

All continuing education programs need to be submitted to the Committee in accordance with Section 021 on forms promulgated by the Director. Any course provider that resides in and has had their continuing education program(s) approved by, a state in which the insurance department has signed a separate reciprocity agreement with the Idaho Department, need not have their continuing education program(s) reviewed and approved by the Committee. However, all such courses need to be filed with the Department in a format approved by the Director and course application fees paid. (3-31-22)

IDAPA 18.06.04.016 - Programs Which Qualify¶

1. Requirements of Acceptable Program. A specific program will qualify as an acceptable continuing education program if it is a formal program of learning which contributes directly to the professional competence of a licensee. It will be left to each individual licensee to determine the course of study to be pursued. All programs need to meet the standards outlined in Section 018. (3-31-22)

2. Subjects Which Qualify. (3-31-22)

   a. The following general subjects are acceptable for producers. (3-31-22)

   i. Insurance, fixed and indexed annuities, and risk management. (3-31-22)
   
   ii. Insurance laws and rules. (3-31-22)
   
   iii. Mathematics, statistics, and probability. (3-31-22)
   
   iv. Economics. (3-31-22)
   
   v. Business law. (3-31-22)
   
   vi. Finance. (3-31-22)
   
   vii. Taxes, trusts, estate planning. (3-31-22)
   
   viii. Business environment, management, or organization. (3-31-22)
   
   ix. Securities. (3-31-22)
   

   b. The following general subjects are acceptable for adjusters and public adjusters. (3-31-22)

   i. Insurance. (3-31-22)
   
   ii. Insurance laws and rules. (3-31-22)
   
   iii. Mathematics, statistics, and probability. (3-31-22)
   
   iv. Economics. (3-31-22)
   
   v. Business law. (3-31-22)
   
   vi. Restoration. (3-31-22)
   
   vii. Communications. (3-31-22)
   
   viii. Arbitration. (3-31-22)
   
   ix. Mitigation. (3-31-22)
   
   x. Glass replacement and/or repair. (3-31-22)
   

   c. Areas other than those listed above may be acceptable if the licensee can demonstrate that they contribute to professional competence and meet the standards set forth in this rule. The responsibility for substantiating that a particular program meets the requirements of this rule rests solely upon the licensee. (3-31-22)

IDAPA 18.06.04.017 - Programs Which Do Not Qualify¶

1. Any Course Used to Prepare for Taking an Insurance Licensing Examination. (3-31-22)

2. Committee Service of Professional Organizations. (3-31-22)

3. Computer Science Courses. (3-31-22)

4. Motivation, Psychology, or Selling Skills Courses. (3-31-22)

5. Reviews, Quizzes and/or Examinations. (3-31-22)

6. Any Program Not in Accordance with This Rule. (3-31-22)

IDAPA 18.06.04.018 - Standards For Continuing Education Programs¶

To qualify for credit, the following standards need to be met by all continuing education programs: (3-31-22)

1. Program Development. (3-31-22)

   a. The program provides significant intellectual or practical content to enhance and improve the insurance knowledge and professional competence of participants. (3-31-22)

   b. The program is developed by persons who are qualified in the subject matter and instructional design. (3-31-22)

   c. The program content is current or up to date. (3-31-22)

2. Program Presentation. (3-31-22)

   a. Instructors are qualified, both with respect to program content and teaching methods. Instructors will be considered qualified if, through formal training or experience, they have obtained sufficient knowledge to instruct the course competently. (3-31-22)

   b. The number of participants and physical facilities is consistent with the teaching method specified. (3-31-22)

   c. All programs will include some means for evaluating quality. (3-31-22)

IDAPA 18.06.04.019 - Measurement Of Credit¶

1. Credits Measured in Full Hours. Professional education courses are credited for continuing education purposes in full hours only. The number of hours is equivalent to the actual number of contact hours which need to include at least fifty (50) minutes of instruction or participation. No credit will be given for partial attendance. (3-31-22)

2. Internet Courses. Internet self-study courses will be credited one (1) hour of continuing education for every fifty (50) minutes of study material, excluding exams. Credit will be given in accordance with Section 021. (3-31-22)

3. Webinar Courses. Webinars will be credited as classroom instruction or participation. In the event one (1) course encompasses multiple webinars and self-study is necessary between webinars, the self-study material need to be submitted to the Committee to be evaluated for additional credit in accordance with Section 021. (3-31-22)

IDAPA 18.06.04.020 - Controls And Reporting¶

1. Licensee to Retain Original Certificate as Evidence. The original certificate of completion received for each educational program or course is retained by the licensee to evidence completion during the two (2) year renewal period. The certificate of completion is in a format provided to the Department. (3-31-22)

2. Sign-In and Sign-Out Sheets. Sign-in and sign-out sheets are to be used and monitored to ensure attendance for the full length of the seminar. No certificate of completion is to be given to anyone arriving late or leaving prior to the conclusion of the seminar. Failure to comply with these requirements will result in loss of certification of the provider in accordance with Section 023. (3-31-22)

IDAPA 18.06.04.021 - Approved Programs Of Study - Certification By Director¶

1. Requirements of Course Approval. All courses are approved by the Committee. If a course is not approved in advance of presentation, an application for credit may be submitted to the Committee within sixty (60) days of completion of the course. (3-31-22)

2. Nonrefundable Application Fee. Each course application is accompanied by a nonrefundable application fee (as set forth in IDAPA 18.01.02, "Schedule of Fees, Licenses and Miscellaneous Charges"). (3-31-22)

3. Course Approval Procedures. Any person intending to provide courses applies in a format prescribed by the Department and provides the following supporting documentation: (3-31-22)

   a. A specific outline and/or course material; (3-31-22)

   b. Time schedule; (3-31-22)

   c. Method of presentation; (3-31-22)

   d. Qualifications of instructor; and (3-31-22)

   e. Other information supporting the request for approval. (3-31-22)

4. Method to Determine Completion. The submission includes a statement of the method used to determine the satisfactory completion of the course. Methods may be an examination, or certification by the provider of the agent's program attendance or completion, or other methods approved by the Director. (3-31-22)

5. Certification of Program. Certification of a program is effective for two (2) years or until any material changes are made in the program, after which it may be resubmitted to the Committee for approval. (3-31-22)

IDAPA 18.06.04.022 - Proof Of Completion¶

An authorized representative of the sponsoring organization will, within thirty (30) days of completion of the course, provide a certificate of completion to each individual who satisfactorily co mpleted the course and certify to the Department electronically a list of all such individuals. (3-31-22)

IDAPA 18.06.04.023 - Approved Subjects - Loss Of Certification¶

1. Program Suspension. The certification of a program may be suspended by the Director if it has been determined that: (3-31-22)

   a. The program teaching method or program content no long er meets the standards of this rule, or have been significantly changed without notice to the Director for recertification; (3-31-22)

   b. The program certified to the Director that an individual completed the program, when in fact the individual had not done so; (3-31-22)

   c. Individuals who have satisfactorily completed the program of study were not so certified by the program; (3-31-22)

   d. The instructor or sponsoring organization is not qualified per the standards of this rule or lacks education or experience in the subject matter of the proposed course; (3-31-22)

   e. The instructor, sponsoring organization, or any company or affiliate of a sponsoring organization has had a license revoked or suspended in any jurisdiction. This includes any firm or organization where a revoked or suspended individual has a substantial ownership interest, or other control in a firm or organization; or (3-31-22)

   f. There is other good and just cause why certification should be suspended. (3-31-22)

2. Reinstatement of a Suspended Certification. Reinstatement of a suspended certification will be made upon proof satisfactory to the Committee or the Director, that the conditions responsible for the suspension have been corrected. (3-31-22)

IDAPA 18.06.04.024 - Credit For Individual Study Programs¶

1. Requirements for Credit of Independent Study Programs. All approved correspondence courses or independent study programs needs to include an examination which requires a score of seventy percent (70%) or better to earn a certificate of completion. For each approved course, the sponsoring organization will maintain multiple tests (two (2) or more) sufficient to maintain the integrity of the testing process. A written explanation of test security and administration methods will accompany the course examination materials. Each unit and/or chapter of a course will contain review questions that can be answered with a score of seventy percent (70%) or better before access to the following unit/chapter is allowed. (3-31-22)

2. Completed Tests. The examinations are administered, graded, and the results recorded by the organization to which approval was originally granted. Completed tests are retained by the sponsoring organization and will not be returned to any licensee. (3-31-22)

3. Prior Approval Needed for Correspondence Courses. All corresponden ce courses need be submitted for approval and approved prior to being offered to licensees for continuing education credit. (3-31-22)

IDAPA 18.06.04.025 - Credit For Service As Lecturer, Discussion Leader, Or Speaker¶

Only one (l) hour of continuing education credit will be awarded for each hour completed as an instructor or discussion leader. (3-31-22)

IDAPA 18.06.05¶

IDAPA 18.06.05.000 - Legal Authority¶

IDAPA 18.06.05.001 - Scope¶

This chapter implements and administers provisions of Title 41, Chapter 15, Idaho Code. (7-1-26)

IDAPA 18.06.05.010 - Definitions¶

The definitions as set forth in Section 41-1502, Idaho Code, apply. (7-1-26)

IDAPA 18.06.05.011 - Notice Provisions¶

1. Notice by MGA. Upon licensure and, thereafter, on or before July 1 of each year, any person acting in the state of Idaho as an MGA provides notice to the Director, which includes: (7-1-26)

   a. A certified copy of the surety bond prescribed by Section 41-1503(3), Idaho Code. (7-1-26)

   b. Proof of insurance coverage as prescribed by Section 013. (7-1-26)

   c. The appropriate nonrefundable designation fee prescribed by IDAPA 18.01.02. (3-31-22)

   d. A list of all names and addresses of insurers doing business in the State of Idaho or Idaho domestic insurers with which the MGA has a contract and a verified statement on a form provided by the Department that the contract(s) contain the provisions prescribed by Section 41-1504, Idaho Code. (3-31-22)

2. Notice by Insurer. In addition to those items specified in Section 41-1505(5), Idaho Code notice by the insurer will include: (7-1-26)

   a. The name and address of the MGA; (3-31-22)

   b. Proof that the MGA has met the bonding requirements of Section 41-1503(3), Idaho Code; (7-1-26)

   c. Proof that the MGA has met insurance requirements of Section 013; (7-1-26)

   d. Procedures and timetable for conducting an onsite review of the underwriting and claims processing operation of the MGA as prescribed by Section 41-1505(3), Idaho Code; and (3-31-22)

   e. The name of an officer of the insurer responsible for the contract. (3-31-22)

IDAPA 18.06.05.012 - Bond¶

The bond amount, as prescribed in Sectio n 41-1503(3), Idaho Code will be adjusted accordingly on or before July 1 of each year. Coverage cannot be written by the insurer or an affiliate of the insurer employing the MGA. (7-1-26)

IDAPA 18.06.05.013 - Errors And Omissions Policy¶

All MGAs acquire and maintain an errors and omissions insurance policy providing for claims arising out of the MGA's negligent acts, errors or omission. The policy coverage limit is set at two hundred fifty thousand dollars ($250,000) or twenty-five percent (25%) of the gross amount of direct written premiums received by an insurer for the previous calendar year that are attributable to the MGA, whichever is greater. The policy coverage limit will be adjusted accordingly on or before July 1 of each year. Unless approved by the director, coverage will not be written by the insurer or an affiliate of the insurer employing the MGA. (7-1-26)

IDAPA 18.06.05.014 - Independent Audit Or Examination¶

1. Annual Independent Audit of MGA. An independent audit by a certified public accountant is conducted annually for MGAs currently under contract and is to be contracted for by the insurer. The independent audit will include the following: (7-1-26)

   a. Report of independent certified public accountant; (3-31-22)

   b. Balance sheet; (3-31-22)

   c. Statement of income; (3-31-22)

   d. Statement of cash flow; (3-31-22)

   e. Statement of income and retained earnings; (3-31-22)

   f. Notes on financial statements - these notes are those prescribed by General Accepted Accounting Principals; and (3-31-22)

   g. A copy of a management letter or a narrative statement setting forth what would have been the content of the management letter had such letter been completed. (3-31-22)

2. Examination of MGA. The Department retains authority to examine an MGA notwithstanding the termination of the MGA's contractual authority. Pursuant to the provisions of Title 41, Chapter 2, Idaho Code, the insurer employing the MGA reimburses the Department for the expense of such examination. (7-1-26)

IDAPA 18.06.05.015 - Termination Of Contract¶

1. Notice to the Department. Notice of the termination of an agreement between an MGA and an insurer for which the MGA was conducting business in the state of Idaho will include the name of the person acting as an MGA under the terms of the contract and the basis for the termination. (7-1-26)

2. Delivery of Records to Insurer upon Termination of Contract. If the contract between an insurer and an MGA is terminated for any reason, the MGA will, upon request by the insurer, deliver all records to the insurer within ninety (90) days of the request. (3-31-22)

IDAPA 18.06.06¶

IDAPA 18.06.06.000 - Legal Authority¶

IDAPA 18.06.06.001 - Scope¶

Provide procedures for the placement of surplus line insurance. (7-1-25)

IDAPA 18.06.06.010 - Definitions¶

In addition to the definitions set forth in Section 41-1213, Idaho Code, the following definitions also apply: (3-31-22)

1. Diligent Search. A Broker has exercised their obligations under Section 41-1214(2), Idaho Code, if the Broker or the referring insurance producer submits a risk to at least one (1) authorized company engaged in writing in Idaho the type of coverage sought, or if there are no companies engaged in writing such coverage, the risk is submitted to at least one (1) company that, in the Broker's or producer's professional judgment, is the most likely to accept the risk. (3-31-22)

2. Delegated Contractor. Any contractor to whom activities have been delegated by the Director under Section 41-1232, Idaho Code. (3-31-22)

IDAPA 18.06.06.011 - Biennial License¶

The Idaho license of a resident or non-resident Broker is to be renewed every two (2) years. A broker will not solicit surplus line business before being licensed as a Broker. A broker will notify the Licensing Division of the Department if not renewing the license prior to the license renewal date to settle any taxes or filing requirements. (7-1-25)

IDAPA 18.06.06.012 - Annual Report¶

The information required in each Broker's annual report is incorporated into and will be filed with the Annual Statement of Premium Taxes, both due March 1 of each year. (7-1-25)

IDAPA 18.06.06.013 - Payment Of State Tax¶

By February 1 of each year, the delegated contractor will provide to each Broker a summary of records showing the state tax due to the Department for the preceding year and owed by the Broker. A flat percentage of the gross premium written during the year is not acceptable since tax was collected on each individual policy and that full amount will be paid to the Department. (7-1-25)

IDAPA 18.06.06.014 - Payment Of Stamping Fees¶

1. Application. A stamping fee is charged on all premiums and policy fees written on Idaho business at a rate established by the delegated contractor and approved by the Department. This rate may be adjusted to obtain the objectives of the delegated contractor. The stamping fee cannot be refunded except in the case of extenuating circumstances approved by the delegated contractor. (3-31-22)

2. Summary. Within ten (10) days following the month during which the surplus line insurance was handled through the delegated contractor, the delegated contractor will submit an invoice summarizing the premium, Idaho tax, and Stamping Fee for each submission processed to each Broker. (3-31-22)

3. Payable on Receipt. The Stamping Fee is payable upon receipt of billing. It is delinquent if not paid within thirty (30) days after the last day of the month in which the business was reported. (3-31-22)

IDAPA 18.06.06.015 - Collection Of Taxes¶

1. Idaho Premium Taxes. Idaho Premium Tax will be collected from the insured. Policy fees, service fees, and other like fees are considered part of the premium and subject to premium tax. State premium taxes will be refunded to the taxpayer upon cancellation of the policy or return of premium for any reason. (3-31-22)

2. Purchasing Groups. Purchasing groups that obtain insurance from any surplus lines insurer will use an Idaho-licensed Broker. The Broker is responsible to collect and submit all taxes and fees as prescribed by this chapter. (7-1-25)

IDAPA 18.06.06.016 - Reporting Taxes And Stamping Fees¶

Brokers are to report premium taxes and stamping fees in increments of not less than one year. A Broker who collects quarterly or monthly payments of premiums from the insured will provide reports of the premium tax and stamping fee in the initial submission or renewal for a full year. (3-31-22)

IDAPA 18.06.06.017 - Placement And Commissions¶

When a producer requests placement by a licensed Broker, the commission received and paid will be based on the mutual written agreement of the parties. (7-1-25)

IDAPA 18.06.06.018 - Submission Time Periods¶

All filings for insurance written pursuant to Chapter 12, Title 41, Idaho Code, are to be received by the delegated contractor within thirty (30) days of receipt by the broker of the certificate, endorsement or other policy document. If the complete submission cannot be made within this time period, the information with submission form and affidavit, if applicable, will be forwarded. The Broker is responsible for meeting this requirement. (7-1-25)

IDAPA 18.06.06.019 - Compliance For Risks Not On Open Lines For Export¶

If a risk does not appear on the Open Lines for Export list, the Broker will file all the same filings for insurance written to Chapter 12, Title 41, Idaho Code. (7-1-25)

IDAPA 18.06.06.020 - Broker Records¶

Reports of all documents processed by the delegated contractor will be provided on a monthly basis to the Broker. These reports, in addition to the broker's full and true records are to be kept for a period of five (5) years and are subject to examination by the Director. (7-1-25)

IDAPA 18.06.06.021 - Approved List Of Insurers¶

The delegated contractor will inform Brokers of any changes to the list of eligible surplus lines insurers. (7-1-25)