C.R.S. § 10-2-101 Short title
10-2-101. Short title. This article shall be known and may be cited as the "Colorado Producer Licensing Model Act".
Licenses
C.R.S. tit. 10, art. 2
in effectC.R.S. § 10-2-102 Scope - applicability
10-2-102. Scope - applicability. This article governs the qualifications and procedures for the licensing of insurance producers. This article is intended to simplify and organize some statutory language to improve efficiency, permit the use of new technology, and reduce costs associated with issuing, continuing, and renewing insurance licenses.
C.R.S. § 10-2-103 Definitions
10-2-103. Definitions. As used in this article, unless the context otherwise requires:
(1) "Catastrophic disaster" means an event, as declared by the president of the United States or the governor, or both, which results in large numbers of deaths or injuries; causes extensive damage or destruction of property or facilities that provide and sustain human needs; produces an overwhelming demand on state and local response resources and mechanisms; causes a severe long-term effect on general economic activity; or severely affects state, local, and private sector capabilities to begin and sustain response activities.
(1.5) "Commissioner" means the commissioner of insurance.
(2) "Health coverage" means accident and health or sickness and accident policies or contracts including other health coverages provided by insurers, health maintenance organizations, or nonprofit hospital and surgical plans.
(2.5) "Home state" means the District of Columbia and any state or territory of the United States in which an insurance producer meets the following:
(a) Maintains the producer's principal place of residence or principal place of business; and
(b) Is licensed to act as an insurance producer.
(3) "Individual" means any private or natural person as distinguished from a partnership, corporation, association, or any foreign or domestic entity as defined in section 7-90-102, C.R.S.
(4) "Insurance" means any of the lines of authority set forth in section 10-2-407 (1).
(5) "Insurance agency" or "business entity" means a corporation, partnership, association, or foreign or domestic entity as defined in section 7-90-102, C.R.S., or other legal entity that transacts the business of insurance.
(6) "Insurance producer" or "producer", except as otherwise provided in section 10-2-105, means:
(a) A person who solicits, negotiates, effects, procures, delivers, renews, continues, or binds:
(I) Policies of insurance for risks residing, located, or to be performed in this state;
(II) Membership in a prepayment plan as defined in parts 2 and 3 of article 16 of this title; or
(III) Membership enrollment in a health-care plan as defined in part 4 of article 16 of this title; and
(b) A public adjuster.
(6.5) "Insurer" means every person engaged as principal, indemnitor, surety, or contractor in the business of making contracts of insurance.
(7) "License" means a document issued by the commissioner that authorizes a person to act as an insurance producer for the lines of authority, specified in such document. The license itself does not create any authority, actual, apparent, or inherent, in the holder to represent or commit an insurance carrier to a binding agreement.
(7.1) "Limited line insurance" means those lines of authority other than those defined in section 10-2-407 (1)(a) to (1)(e) or any other line of insurance that the commissioner may deem necessary to recognize for the purpose of complying with section 10-2-502.
(7.3) "Limited line producer" means a person authorized by the commissioner to sell, solicit, or negotiate limited lines of insurance.
(7.5) "Limited lines credit insurance" includes credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection insurance, and any other form of insurance offered in connection with an extension of credit that is limited to partially or wholly extinguishing the insured credit obligation that the commissioner determines should be designated a form of limited line credit insurance.
(7.7) "Limited lines credit insurance producer" means a person who sells, solicits, or negotiates one or more forms of limited lines credit insurance coverage to individuals through a master, corporate, group, or individual policy.
mited to partially or wholly extinguishing the insured credit obligation that the commissioner determines should be designated a form of limited line credit insurance.
(7.7) "Limited lines credit insurance producer" means a person who sells, solicits, or negotiates one or more forms of limited lines credit insurance coverage to individuals through a master, corporate, group, or individual policy.
(7.9) "Negotiate" means the act of conferring directly with or offering advice directly to a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms, or conditions of the contract, if the person engaged in that act either sells insurance or obtains insurance from insurers for purchasers or acts as a public adjuster.
(8) "Person" includes any individual or a business entity.
(8.5) "Public adjuster" means any person who, for compensation or any other thing of value on behalf of the insured:
(a) Acts or aids, solely in relation to first-party claims arising under insurance contracts that insure the real or personal property or allied lines of the insured, on behalf of an insured in negotiating for, or effecting, the settlement of a claim for loss or damage covered by an insurance contract;
(b) Advertises for employment as a public adjuster of insurance claims or solicits business or represents himself or herself to the public as a public adjuster of first-party insurance claims for losses or damages arising out of policies of insurance that insure real or personal property or allied lines; or
(c) Directly or indirectly solicits business, investigates or adjusts losses, or advises an insured about first-party claims for losses or damages arising out of policies of insurance that insure real or personal property or allied lines for another person engaged in the business of adjusting losses or damages covered by an insurance policy for the insured.
(9) (Deleted by amendment, L. 2001, p. 1190, § 3, effective January 1, 2002.)
(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, asking or urging a person to apply for a particular kind of insurance from a particular company, or asking or urging a person to use the services of, or services in connection with activities as, a public adjuster.
(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.
(13) "Uniform business entity application" means the current version of the national association of insurance commissioners' uniform business entity application for resident and nonresident business entities.
(14) "Uniform application" means the current version of the national association of insurance commissioners' uniform application for resident and nonresident producer licensing.
C.R.S. § 10-2-104 Authority of commissioner - rules
10-2-104. Authority of commissioner - rules. Pursuant to the provisions of article 4 of title 24, C.R.S., the commissioner may promulgate reasonable rules for the implementation and administration of the provisions of this article. The commissioner may contract with any party for the purpose of performing any ministerial duty required of the commissioner under this article. All reasonable charges and expenses of such contractors shall be paid directly to the contractors by licensees.
C.R.S. § 10-2-105 Insurance producer - exemptions from definition
10-2-105. Insurance producer - exemptions from definition. (1) Nothing in this article 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) Notwithstanding section 10-2-103 (6), "insurance producer" does not include the following:
(a) Any person who is a regularly salaried officer, director, or employee of an insurance company or an insurance producer and who is engaged in the performance of usual or customary executive, administrative, or clerical duties which do not include the negotiation or solicitation of insurance, so long as 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;
(b) Any person who is a salaried employee in the office of an insurance producer or insurer and who devotes full time to clerical and administrative services, including the incidental taking of insurance applications and receipt of premiums in the office of such person's employer, so long as the person does not receive any commission on such applications and the person's compensation is not varied by the volume of applications or premiums taken or received;
(c) An officer, director, or employee whose activities are executive, administrative, managerial, clerical, or a combination of these, and are only indirectly related to the sale, solicitation, or negotiation of insurance;
(c.3) An officer, director, or employee whose function relates to underwriting, loss control, inspection, or the processing, adjusting, investigating, or settling of a claim on a contract of insurance;
(c.5) An officer, director, or employee who is acting in the capacity of a special agent or agency supervisor assisting insurance producers, where the officer's, director's, or employee'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;
(c.7) A person who secures and furnishes information for the purpose of group life insurance, group property and casualty insurance, group annuities, or 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 related to mass marketed property and casualty insurance, where no commission is paid to the person for the service;
(d) Employers, associations, or their officers, directors, or employees, or the trustees of any employee trust plan, to the extent that such employers, associations, officers, directors, employees, or trustees are engaged in the administration or operation of any program of employee benefits for their own employees or the employees of their subsidiaries or affiliates, which program involves the use of insurance issued by an insurer; except that such employers, associations, officers, directors, employees, or trustees shall not in any manner be compensated, directly or indirectly, by the company issuing the contracts;
(e) Employees of insurers or insurance agencies or organizations employed by insurers or insurance agencies 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 solicitation or negotiation of policies or contracts for insurance;
(f) Management associations, partnerships, or corporations whose operations do not entail solicitation of insurance from the public;
or insurance agencies 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 solicitation or negotiation of policies or contracts for insurance;
(f) Management associations, partnerships, or corporations whose operations do not entail solicitation of insurance from the public;
(g) Officers or employees of a motor vehicle rental company that offers coverage in connection with and incidental to the rental of motor vehicles under motor vehicle rental agreements, so long as such coverage is:
(I) Offered at the point of the rental transaction or by preselection of coverage in master, corporate, group, or individual rental agreements;
(II) Limited in scope to the parties to such motor vehicle rental agreements and to other authorized drivers or occupants of the vehicles being rented;
(III) Limited in duration to coverage of damages incurred as a result of events occurring during the rental period; and
(IV) For traditionally recognized risks associated with motor vehicle operation and travel, including, without limitation, personal injury or death, personal liability and property damage, collision, damage to or loss of personal effects, roadside assistance, and emergency repairs;
(h) 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, so long as the person does not sell, solicit, or negotiate insurance that would insure risks residing, located, or to be performed in this state;
(i) 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 state insured under that contract, so long as 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; or
(j) 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, so long as the employee does not sell or solicit insurance or receive a commission.
(2.5) With respect to public adjusters, a license as a public adjuster is not required for:
(a) An attorney-at-law admitted to practice in this state, when acting in his or her professional capacity as an attorney;
(b) A person who negotiates or settles claims arising under a life or health insurance policy or an annuity contract;
(c) A person employed only for the purpose of obtaining facts surrounding a loss or furnishing technical assistance of an incidental nature to a licensed public adjuster, including a photographer, estimator, private investigator, engineer, or handwriting expert;
(d) A licensed health-care provider, or employee of a licensed health-care provider, who prepares or files a health claim form on behalf of a patient; or
(e) A person who settles subrogation claims between insurers.
C.R.S. § 10-2-201 Prelicensure education - when required
10-2-201. Prelicensure education - when required. (1) (a) Except as otherwise provided in section 10-2-202, in addition to other requirements for licensure as specified under this article and as a condition of initial licensure, an individual applicant for qualification in life, sickness and accident, or property and casualty lines shall be required to provide evidence to the commissioner that the individual applicant has satisfactorily completed an approved prelicensure education or training course or program as follows:
(I) An individual seeking insurance producer licensure authority for life insurance shall complete at least fifty hours of an approved course or program for certification in life insurance; and, of the said fifty hours, at least three hours shall pertain specifically to insurance industry ethics;
(II) An individual seeking insurance producer licensure authority for health coverage shall complete at least fifty hours of an approved course or program for certification in sickness and accident insurance; and, of the said fifty hours, at least three hours shall pertain specifically to insurance industry ethics;
(III) An individual seeking insurance producer licensure authority for property or casualty insurance or both shall complete at least fifty hours of an approved course or program for certification in property or casualty insurance or both; and, of the said fifty hours, at least three hours shall pertain specifically to insurance industry ethics.
(b) An individual seeking an insurance producer license to include life, sickness and accident, property, or casualty lines or any combination thereof shall not be eligible to take the written examination provided for in section 10-2-402 until the prelicensure education requirements specified in this subsection (1) pertaining to the line or lines of insurance applied for have been satisfied.
(2) The commissioner shall adopt all rules necessary to carry out the prelicensing education provisions of this section. Such rules shall set forth standards for courses and programs to qualify for approval by the commissioner and shall also prescribe a system of control and reporting.
(3) An individual seeking an insurance producer license shall pay to the commissioner, in addition to any other applicable fees or charges, a fee established by the commissioner in accordance with section 10-2-413 for operation of the prelicensing education program.
C.R.S. § 10-2-202 Exemption from prelicensure education requirements
10-2-202. Exemption from prelicensure education requirements. (1) Prelicensure education as set forth in section 10-2-201 shall not be required of an individual who is:
(a) Applying to reinstate a canceled or expired resident insurance producer license in this state when such license has been inactive for one year or less;
(b) Applying for temporary license authority under section 10-2-410;
(c) Applying for a resident insurance producer license in this state, was previously licensed in his or her former resident state, and has completed or satisfied prelicensure education as required by that state pertinent to the line or lines of insurance applied for in Colorado;
(d) Applying for a nonresident license in this state pertinent to the line or lines of authority held in the producer's home state.
C.R.S. § 10-2-203 Course certification, registration, and review by commissioner
10-2-203. Course certification, registration, and review by commissioner. (1) Prelicensure education courses or programs that will be provided and offered to persons applying for life, sickness and accident, property, or casualty licensing are subject to review and certification by the commissioner, except that:
(a) Any full-time program of prelicensure education operated by a qualified domestic company or a company with a qualified home office located in Colorado shall not be subject to review and certification by the commissioner; and
(b) Any applicant or licensee who has attended such a course or program shall be deemed in compliance with the provisions of section 10-2-201 upon certification by the applicant that he or she has completed all required hours of instruction through such a course or program.
(2) Course instruction, content, outline, and course instructors are subject to initial approval by the commissioner and, at the discretion of the commissioner, are also subject to periodic review for continuation. The course provider shall remit the fee as prescribed in accordance with section 10-2-413 to continue or renew such approved course or program.
(3) If, upon review, the commissioner finds that a prelicensure education course or program is not in compliance with all applicable standards, as set forth by rule, the commissioner may order the course or program to be discontinued or revoke the approval of the course provider or both.
C.R.S. § 10-2-301 Continuing education requirement - rules
10-2-301. Continuing education requirement - rules. (1) Producers not exempt from the requirements of this section shall satisfactorily complete up to twenty-four hours of instruction by attending courses or programs of instruction approved by the commissioner. At least three of the twenty-four hours of continuing education must be for courses in ethics. For producers authorized to sell property or personal insurance lines of business, at least three of the twenty-four hours of continuing education must be for courses in homeowner's insurance coverage. The commissioner may adopt rules concerning testing requirements as a part of the certified continuing education. The producer shall complete the required hours of instruction within twenty-four months after the date the producer's license renews, beginning with renewal dates on or after January 1, 1993. A producer may accumulate no more than twelve carry-over credit hours during the one hundred twenty days before the licensing continuation date. Carry-over credits apply to the next continuing education period. If a producer has more than one license to sell insurance in this state, the producer shall complete the required hours of instruction within twenty-four months after the date of renewal of the first license. For good cause shown, the commissioner may grant an extension of time, not exceeding one additional year, within which to comply with this section. An instructor of an approved course of instruction qualifies for the same number of hours of continuing education as a person attending and successfully completing the course or program, but an instructor shall not receive credit more than once for a course or program given more than once during the twenty-four-month period described in this subsection (1).
(2) Any producer who is subject to the requirements of this section shall furnish in a form satisfactory to the commissioner written proof of compliance with the requirements of this section. The requirements of this section are mandatory for any person specified in subsection (3)(a) of this section, and if any such person holds more than one license which is described in subsection (3) of this section, such person shall be required to complete the hours of instruction required under this section only once. For purposes of this section, the term "person" shall include any holder of a license to sell insurance under the laws of this state.
(3) (a) The requirements of this section shall apply to any resident person licensed to solicit and sell the following types of insurance in this state:
(I) Life insurance and annuity contracts, including variable life and annuity contracts;
(II) Sickness, accident and health insurance;
(III) Property and casualty insurance; and
(IV) Any other type of insurance for which the state requires an examination for licensure.
(b) This section shall not apply to any person holding a limited or restricted license if such license is in good standing with the division and no complaints have been filed against the licensee.
(3.5) (a) An individual who holds a public adjuster license and who is not exempt under paragraph (b) of this subsection (3.5) shall satisfactorily complete continuing education courses as required by the commissioner under this section.
any person holding a limited or restricted license if such license is in good standing with the division and no complaints have been filed against the licensee.
(3.5) (a) An individual who holds a public adjuster license and who is not exempt under paragraph (b) of this subsection (3.5) shall satisfactorily complete continuing education courses as required by the commissioner under this section.
(b) Licensees holding nonresident public adjuster licenses who have met the continuing education requirements of their home state and whose home state gives credit to residents of this state on the same basis meet the requirements of this section.
(4) Written certification of any course of instruction completed shall be executed by or on behalf of the sponsoring organization, in a form satisfactory to the commissioner.
(5) Any person who fails to comply with the requirements of this section, or is found after a hearing before the division to have submitted a false or fraudulent certificate of compliance to the commissioner, shall have his or her license suspended until such person satisfactorily demonstrates to the commissioner that all of the requirements of this section, and any other applicable licensing requirement or other statute, have been met.
(6) (a) The commissioner shall be responsible for administering the continuing insurance education requirements under this article and approving courses of instruction that qualify for such purposes. The commissioner shall promulgate such rules as the commissioner deems necessary to administer the continuing education requirements, including the provisions and requirements of this section. The commissioner shall also promulgate rules requiring that producers be required to provide to a continuing education administrator proof of compliance with the continuing education requirements as a condition of license renewal. For persons licensed pursuant to section 10-11-116 (1)(c), compliance with the continuing legal education credits requirements of the Colorado supreme court shall be deemed to meet the requirements of this section.
(b) The position of continuing education administrator shall be established by the commissioner either within the division of insurance or through a contractual arrangement with an outside service provider. All costs of such administrator shall be paid from continuing insurance education fees paid by producers in the manner provided by this section. In no event may the commissioner delegate course approval responsibilities to the continuing education administrator.
(c) Each producer licensed under this article is responsible for paying to the continuing education administrator a reasonable biennial fee for the operation of the continuing education programs, which fee is used to administer the provisions of this section.
(6.5) (a) Continuing education course instruction, content, outline, and course providers are subject to initial approval by the commissioner and, at the discretion of the commissioner, are subject to periodic review for continuation.
(b) If, upon review, the commissioner determines that a continuing education course or program is not in compliance with all applicable standards, as set forth by rule, the commissioner may order the course or program to be discontinued or revoke approval of the course provider, or both.
(7) Repealed.
C.R.S. § 10-2-401 License required
10-2-401. License required. (1) No person shall act as or hold oneself out to be an insurance producer unless duly licensed as an insurance producer in accordance with this article. Every insurance producer who solicits or negotiates an application for insurance of any kind on behalf of an insurer shall be regarded as representing the insurer and not the insured or any beneficiary of the insured in any controversy between the insurer and such insured or beneficiary. A person shall not sell, solicit, or negotiate insurance in this state for any class or classes of insurance unless the person is licensed for that line of authority in accordance with this article.
(2) No insurance producer shall make application for, procure, negotiate for, or place for others any policies for any line or lines of insurance for which he or she is not then qualified and licensed.
(3) (a) Any representative of a fraternal benefit society who solicits and negotiates insurance contracts is an insurance producer and is subject to the same licensing requirements as those for an insurance producer; except that a license is not required of any officer, employee, or secretary of a fraternal benefit society or of a subordinate lodge or branch thereof who devotes substantially all of his or her time to activities other than the solicitation or negotiation of insurance contracts and who receives no commission or other compensation directly dependent upon the number or amount of insurance contracts solicited or negotiated.
(b) Any agent, representative, or member of a fraternal benefit society who in the preceding calendar year solicited and procured life insurance contracts on behalf of any society in a face amount of insurance not exceeding fifty thousand dollars or, in the case of any other kind of insurance that the fraternal benefit society may write, solicited and procured such insurance on behalf of not more than twenty-five individuals, who received no commissions or other compensation therefor, and who does not reasonably expect to exceed soliciting or procuring insurance on behalf of more than twenty-five individuals in the current year, shall be exempt from the licensing requirements for an insurance producer.
(4) No insurance producer license shall be granted or extended to any person if the license is being or will be used for the purpose of writing controlled business. As used in this section, "controlled business" means insurance procured or to be procured by or through such person upon:
(a) The person's own life, person, property, or risks, or those of his or her spouse; or
(b) The life, person, property, or risks of the person's employer or the person's own business.
(5) Such a license shall be deemed to have been, or intended to be, used for the purpose of writing controlled business, if during any twelve-month period the aggregate amount of premiums on controlled business would exceed the aggregate amount of premiums on all other insurance business of the applicant or licensee.
(6) A title insurance agent and a title insurance company, as defined in section 10-11-102 (9) and (10), shall disclose the names of all affiliated business arrangements to which the company or agent is a party at the time of application for a new license, on the continuation due date of an existing license, and upon a change to any identifying information, in a form and manner acceptable to the commissioner. The disclosure shall include the physical location of the affiliated businesses, identify the settlement producer with whom the company or agent is associated, and identify the underwriter of the title insurance business.
C.R.S. § 10-2-402 License examination requirement
10-2-402. License examination requirement. (1) Unless exempt pursuant to section 10-2-403, a resident individual applying for an insurance producer license shall pass a written examination. The examination shall reasonably test the individual applicant's minimum acceptable level of competence as to the particular line or lines of authority for which the individual applicant seeks qualification, unless an individual applicant has been licensed as an insurance producer for the same line or lines of authority in another state within the twelve months immediately preceding the date of receipt of application and files with the commissioner a letter of clearance, issued by the public official having supervision of insurance in the applicant's former state of residence, stating the individual held a license for the same line or lines of authority during such twelve-month period and that the license was in good standing.
(2) Examination for licensing shall be held at such reasonable times and places as are designated by the commissioner, and such times and places shall be made public.
(3) (a) Each individual applying for an examination shall remit a nonrefundable fee as prescribed by the commissioner in accordance with section 10-2-413.
(b) The application for examination shall request the applicant to provide the following information:
(I) The applicant's name, age, residence address, business address, and mailing address;
(II) The name of any required prelicensing course he or she has completed or is in the process of completing;
(III) The method by which the applicant intends to qualify for the license if other than completing a prelicensing course;
(IV) The highest level of education achieved by the applicant; and
(V) The applicant's gender, native language, and race or ethnicity; except that the application shall contain a statement that an applicant is not required to disclose his or her gender, native language, or race or ethnicity, that he or she will not be penalized for not doing so, and that the department will use this information exclusively for research and statistical purposes and to improve the quality and fairness of the examinations.
(c) No later than six months after August 5, 2008, and annually thereafter, the commissioner shall prepare and publish a report that summarizes statistical information relating to insurance producer examinations administered during the preceding calendar year. The report shall include the following information for all examinees combined and separately by race or ethnicity, gender, race or ethnicity within gender, education level, and native language:
(I) The total number of examinees;
(II) The percentage and number of examinees who passed the examination;
(III) The mean scaled scores on the examination; and
(IV) Standard deviation of scaled scores on the examination.
nclude the following information for all examinees combined and separately by race or ethnicity, gender, race or ethnicity within gender, education level, and native language:
(I) The total number of examinees;
(II) The percentage and number of examinees who passed the examination;
(III) The mean scaled scores on the examination; and
(IV) Standard deviation of scaled scores on the examination.
(d) If the commissioner arranges to have the examinations for licensure administered by an independent testing service pursuant to section 10-2-402 (5), the commissioner may provide demographic information to the testing service if the commissioner requires the independent examiner to review and analyze examination results in conjunction with the gender, native language, education level, and race or ethnicity of the examinees.
(4) (Deleted by amendment, L. 2001, p. 1195, § 9, effective January 1, 2002.)
(5) The commissioner shall give, conduct, and grade all examinations, or the commissioner may arrange to have examinations administered and graded by an independent testing service, as specified by contract, in a fair and impartial manner and without discrimination as to individuals examined. The commissioner may arrange for such testing service to recover the cost of the examination from the applicant.
(6) There shall be a separate portion of the examination required for each line of insurance which the applicant proposes to transact under the license.
(7) (Deleted by amendment, L. 2001, p. 1195, § 9, effective January 1, 2002.)
(8) An individual who fails to pass an examination shall remit the required fee and any forms required to retake the failed examination.
(9) An individual who fails to appear for a scheduled examination shall remit the required fee and any forms required to reapply to take the examination.
(10) Applicants for life, health coverages, property, or casualty examinations shall comply with prelicensure education requirements as prescribed in section 10-2-201 prior to taking the written examination.
(11) An insurance producer license issued on or before January 1, 2002, for health maintenance organizations ("HMO") or nonprofits may be renewed or continued until the licensee fails to meet the requirements of this part 4.
C.R.S. § 10-2-403 Exemption from license examination
10-2-403. Exemption from license examination. (1) The following applicants shall be exempt from the written examination requirements set forth in section 10-2-402:
(a) An individual who applies for an insurance producer license in this state who was previously licensed for the same lines of authority in this state or another state shall not be required to complete any prelicensing education or examination. This exemption is only available to a nonresident applicant if:
(I) (A) The person is currently licensed in his or her home state for the same line or lines of authority; or
(B) The application is received within twelve months after the cancellation of the applicant's previous license; and
(II) (A) The prior state issues a certification that, at the time of cancellation, the applicant was in good standing in that state; or
(B) The state's producer database records, 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 line of authority requested.
(b) An individual applicant for a health maintenance organization or nonprofit hospital representative producer license or a travel-ticket-selling insurance producer license to solicit, procure, and deliver accident and health or travel baggage insurance policies offered by a life, casualty, or multiple-line insurer licensed in this state;
(b.5) A person licensed as an insurance producer in another state who moves to this state shall make application within ninety days after establishing legal residence to become a resident licensee pursuant to section 10-2-404. No prelicensing education or examination shall be required of that person to obtain any line of authority previously held in the prior state except where the insurance commissioner determines otherwise by regulation.
(c) An individual applicant who holds the designation of chartered life underwriter ("CLU"); except that such individual is not exempt from that portion of the examination pertaining to Colorado laws and rules pertinent to life insurance and health coverage insurance;
(d) An individual applicant who has attained the designation of chartered property and casualty underwriter ("CPCU"); except that such individual is not exempt from taking that portion of the examination pertaining to Colorado laws and rules pertaining to property, casualty, or health coverage;
(e) A nonresident individual applicant who is in compliance with section 10-2-501 (1)(a);
(f) A licensed life insurance producer applicant for a variable contracts license who is in compliance with the qualification requirement in section 10-2-407;
(g) An individual applicant who holds the designation of chartered financial consultant ("ChFC"); except that such individual is not exempt from that portion of the examination pertaining to Colorado laws and rules pertinent to life insurance and health coverage insurance;
(h) An individual applicant who holds the designation of registered health underwriter ("RHU"); except that such individual is not exempt from that portion of the examination pertaining to Colorado laws and rules pertinent to life insurance and health coverage insurance.
C.R.S. § 10-2-404 Application for license
10-2-404. Application for license. (1) An applicant for a resident insurance producer license shall make application on a form specified by the commissioner and shall 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 individual's knowledge and belief. Before approving the application, the commissioner shall verify that:
(a) The individual is at least eighteen years of age;
(b) The individual has not committed any act which is a ground for denial, suspension, or revocation as set forth in section 10-2-801;
(c) The individual is a resident of this state or is a resident of another state and meets the requirements of section 10-2-502;
(d) If the individual applicant is a nonresident, such applicant has furnished the commissioner with a current certification of license status pursuant to section 10-2-502 (1)(e);
(e) Unless exempt, the individual has satisfied minimum prelicensure education requirements pursuant to part 2 of this article;
(f) The individual has paid the license fee prescribed by the commissioner in accordance with section 10-2-413;
(g) The individual has successfully passed the examination or has satisfied examination qualification requirements for the line or lines of authority for which the individual has applied; and
(h) The individual is competent, trustworthy, and of good moral character and good business reputation.
(2) An insurance agency or business entity acting as an insurance producer shall obtain an insurance producer license. Application shall be made on a form specified by the commissioner. Before approving the application, the commissioner shall verify that:
(a) The agency has disclosed to the insurance commissioner all officers, partners, and directors, whether or not they are licensed as insurance producers;
(b) The agency's officers, directors, or partners are trustworthy, of good moral character, and of good business reputation;
(c) The insurance agency or business entity has paid the fees prescribed by the commissioner in accordance with section 10-2-413;
(d) The insurance agency or business entity has designated a licensed producer who is an officer, partner, or director responsible for the insurance agency's or business entity's compliance with the insurance laws and rules of this state;
(e) The insurance agency or business entity has registered with the commissioner the name of each natural person who, as an officer, director, partner, owner, or member of the insurance agency or business entity, is acting as and is licensed as an insurance producer;
(f) The insurance agency or business entity has registered with the commissioner at least one individual who holds a valid insurance producer license for the line or lines of authority requested in the application;
(g) If the insurance agency's or business entity's filing status is nonresident, the insurance agency or business entity has complied with the qualification requirements of section 10-2-502.
(3) The commissioner may require the filing of any documents reasonably necessary to verify the information contained or required in the application.
(4) Each insurer that sells, solicits, or negotiates any form of limited line credit insurance shall provide to each individual whose duties will include selling, soliciting, or negotiating limited lines credit insurance, a program of instruction that may be approved by the insurance commissioner.
C.R.S. § 10-2-405 Residency - individuals - agencies
10-2-405. Residency - individuals - agencies. (1) The commissioner may qualify an applicant as a resident of this state and shall issue an insurance producer license to any qualified resident person of this state in accordance with the following:
(a) An individual applicant may qualify as a resident only if he or she resides in this state. Any license issued pursuant to any application claiming residency for licensing purposes shall constitute an election of residency in this state and shall be void if the licensee, while holding a resident license in this state, also holds or makes application for a license in or thereafter claims to be a resident of any other state or jurisdiction, or if the licensee ceases to be a resident of this state.
(b) An insurance agency or business entity may qualify as a resident if the agency has its principal office in this state;
(c) The resident person is in compliance with the requirements of section 10-2-404.
C.R.S. § 10-2-406 Licensing of agencies
10-2-406. Licensing of agencies. (1) For the purposes set forth in section 10-2-701, an insurance agency or business entity shall be licensed as an insurance producer.
(2) (a) The insurance agency or business entity shall register the name of every natural person who, as a member, officer, director, stockholder, owner, or employee of the agency or business entity, is acting as and is licensed as an insurance producer.
(b) A fee, prescribed by the commissioner in accordance with section 10-2-413, shall be paid for the registration of each insurance producer.
(3) The insurance agency or business entity shall, within ten days, notify the commissioner, on a form prescribed by the commissioner, of every change relative to the licensed individual insurance producers registered and authorized to act as insurance producers for the insurance agency or business entity.
(4) The insurance agency or business entity shall, within ten days, notify the commissioner, on a form prescribed by the commissioner, of any change relative to the insurance agency or business entity name, officers, directors, partners, or owners, to report a merger, or that the insurance agency or business entity has ceased doing business in this state.
(5) When an insurance agency or business entity ceases to do business in this state, the insurance agency or business entity shall return the producer license to the commissioner within ten days after ceasing to do business.
(6) When an insurance agency or business entity changes its principal address to another state, the insurance agency or business entity shall, within ten days, notify the commissioner and return the producer license for cancellation. Relicensing will be subject to the provisions of part 5 of this article.
(7) (a) The insurance agency or business entity shall comply with section 10-2-404.
(b) A nonresident insurance agency shall also comply with the qualification requirements of section 10-2-501.
C.R.S. § 10-2-407 License - definitions of lines of insurance - authority
10-2-407. License - definitions of lines of insurance - authority. (1) Unless a person is denied licensure pursuant to section 10-2-801, the division shall issue to a person who has met the requirements of sections 10-2-401 and 10-2-404 an insurance producer license. An insurance producer may receive qualification for a single license to include one or more of the following lines of authority:
(a) "Life", which means insurance coverage on human lives that:
(I) Shall include benefits of endowment and annuities; and
(II) May include benefits for:
(A) The event of death or dismemberment by accident; and
(B) Disability income;
(b) "Accident and health", which means insurance coverage for sickness, bodily injury, or accidental death and that may include benefits for disability income;
(c) "Variable life and variable annuity products", which means insurance coverage provided under variable life insurance contracts and variable annuities;
(d) "Property", which means insurance coverage for the direct or consequential loss or damage to property of every kind;
(e) "Casualty", which means insurance coverage against legal liability, including that for death, injury, or disability or damage to real or personal property;
(f) Repealed.
(g) Limited lines credit insurance;
(h) Crop hail;
(i) Title;
(j) Surplus lines;
(k) Travel insurance, as defined in section 10-2-414.5;
(l) Health maintenance organizations ("HMO"); except that no person shall be issued a new license for this individual line of authority on or after January 1, 2002, pursuant to section 10-2-402;
(m) Nonprofits; except that no person shall be issued a new license for this individual line of authority on or after January 1, 2002, pursuant to section 10-2-402;
(n) "Personal lines", which means property and casualty insurance sold to individuals and families for primarily noncommercial purposes; or
(o) Any other line of insurance permitted under state law or regulation.
(2) (Deleted by amendment, L. 2001, p. 1199, § 14, effective January 1, 2002.)
(3) An insurance producer license for surplus lines may be issued to resident persons pursuant to article 5 of this title.
C.R.S. § 10-2-408 License - contents - continuation due date
10-2-408. License - contents - continuation due date. (1) The commissioner shall issue a perpetual insurance producer license to an applicant who has met the requirements of section 10-2-404.
(2) The license shall state the name, address, and personal identification number of the licensee, the date of issuance, general conditions relative to expiration or cancellation, the line or lines of insurance covered by the license, and any other information the commissioner deems proper or necessary.
(3) The license issued to an individual, as a sole proprietor, shall include the trade name under which the licensee acts in the solicitation or negotiation of insurance contracts.
(4) Subject to continuation, each insurance producer license shall remain in effect unless revoked or suspended as long as the continuation fee as prescribed by the commissioner in accordance with section 10-2-413 is paid and education requirements are met on or before the due date.
(5) The commissioner shall establish, by rule, the continuation due date and application procedures for continuation of the license and for the acceptance of a late filing fee.
(6) Any person who holds either a Colorado insurance producer license, a resident surplus lines license, or the equivalent issued by another state or territory that offers Colorado surplus lines producers' nonresident licenses on a reciprocal basis and is deemed by the commissioner to be competent and trustworthy may be licensed as a surplus line producer upon the condition that the producer shall conduct business under the license in accordance with the provisions of this article and shall promptly remit the taxes provided by section 10-5-111.
(7) A licensed insurance producer who fails to comply with license continuation or renewal procedures due to military service, long-term medical disability, or any other condition the commissioner deems appropriate, may request a waiver of 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 continuation or renewal procedures.
C.R.S. § 10-2-409 License - amendment - reissuance
10-2-409. License - amendment - reissuance. (1) An insurance producer licensee shall promptly notify the commissioner, on a form prescribed by the commissioner, of any change that will require amending a license to reflect that change, including without limitation a legal change of the licensee's name, a change of address, or change or removal of a trade name. The commissioner may require the licensee to furnish any documents necessary to verify any change and to properly amend the license.
(2) Repealed.
C.R.S. § 10-2-410 Temporary licensing
10-2-410. Temporary licensing. (1) The commissioner may issue a temporary license to an individual to act as an insurance producer for a period not to exceed one hundred eighty days, without requiring an examination, if the commissioner deems that such temporary license authority is necessary for the servicing of an insurance business in the following cases:
(a) To the surviving spouse or next of kin, or to the executor or an employee, of a licensed insurance producer who becomes deceased;
(b) To the surviving spouse or next of kin, or to an employee or the legal guardian, of a licensed insurance producer who becomes disabled;
(c) To a member, employee, or officer of a licensed insurance agency or business entity, licensed as an insurance producer upon the death or disability of an individual designated in or registered as to the agency or business entity license;
(d) To the designee of a licensed insurance producer upon entering active service in the armed forces of the United States;
(e) To any person in any other circumstance where the commissioner deems that the public interest will best be served by the issuance of such license.
(2) The commissioner may, by order, limit the authority of any temporary licensee in any way deemed necessary to protect insureds and the public. The commissioner may require the temporary licensee to have a suitable sponsor who is a licensed producer or insurer and who assumes responsibility for all acts of the temporary licensee. The commissioner may impose other requirements designed to protect insureds and the public. The commissioner may, by order, revoke a temporary license if the interest of insureds or the public are endangered. A temporary license may not continue after the owner or the personal representative disposes of the business.
C.R.S. § 10-2-411 Duplicate license
10-2-411. Duplicate license. The commissioner may issue a duplicate license to any actively licensed insurance producer if such producer's license is lost, stolen, or destroyed upon an affidavit by the producer in a form prescribed and furnished by the commissioner concerning the facts of such loss, theft, or destruction.
C.R.S. § 10-2-412 Change of address - notification
10-2-412. Change of address - notification. (1) Individual and insurance agency producer licensees shall inform the commissioner in writing, in a form prescribed by the commissioner, of any change of address within thirty days after the change.
(2) Failure of any licensee to inform the commissioner of any change to the licensee's address of record or residence address shall be grounds for the assessment of a penalty.
C.R.S. § 10-2-413 Fees
10-2-413. Fees. (1) The commissioner shall, by rule, set reasonable fees and penalties for the following:
(a) Insurance producer license; and
(b) Continuation of license.
(2) All fees payable to the commissioner pursuant to this section shall be nonrefundable. Fees shall be set at the levels necessary to ensure that revenues from such fees, together with revenues from all other fees and taxes collected by the division of insurance in any fiscal year, do not exceed the division's actual direct and indirect costs of operation for that year.
C.R.S. § 10-2-414 Additional lines of authority - application for license
10-2-414. Additional lines of authority - application for license. An insurance producer licensee requesting licensure for any additional line or lines of authority shall comply with the requirements of section 10-2-404. Upon receipt of the application filing, any supporting documents as required by section 10-2-404, and the applicable fee, the commissioner may issue a replacement license to include the additional lines.
C.R.S. § 10-2-414.5 Travel insurance - limited lines license - travel insurance producers - definitions - rules
10-2-414.5. Travel insurance - limited lines license - travel insurance producers - definitions - rules. (1) As used in this section:
(a) "Limited lines travel insurance producer" means:
(I) A licensed insurance producer, including a limited line producer, who is designated by an insurer as the travel insurance supervising entity; or
(II) A travel administrator, as defined in section 10-4-1903 (11).
(b) "Offer and disseminate" means to provide general information about travel insurance, including a description of the coverage and price, as well as processing the application, collecting premiums, and performing other nonlicensable activities permitted by the state.
(c) (I) "Travel insurance" means insurance coverage for personal risks incident to planned travel, including:
(A) Interruption or cancellation of a trip or event;
(B) Loss of baggage or personal effects;
(C) Damages to accommodations or rental vehicles;
(D) Sickness, accident, disability, or death occurring during travel;
(E) Emergency evacuation;
(F) Repatriation of remains; or
(G) Any other personal risks for which a contractual obligation exists to indemnify or pay a specified amount to the traveler upon determinable contingencies related to travel, as approved by the commissioner.
(II) "Travel insurance" does not include major medical plans that provide comprehensive medical protection for travelers with trips lasting longer than six months, including a person working overseas as an expatriate, or any other product that requires a specific insurance producer license.
(d) "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.
(2) (a) (I) The commissioner may issue a limited lines travel insurance producer license to an individual or business entity that has filed an application with the commissioner in a form and manner prescribed by the commissioner and has paid all applicable licensing fees, as set forth in the applicable state law.
(II) A limited lines travel insurance producer must be licensed in order to sell, solicit, or negotiate travel insurance through a licensed insurer.
(III) A person shall not act as a limited lines travel insurance producer or travel retailer unless the person is properly licensed or registered as a limited lines travel insurance producer or travel retailer, respectively.
(b) A travel retailer may offer and disseminate travel insurance as a service to its customers on behalf of and under the direction of a business entity that holds a limited lines travel insurance producer license. In doing so, the travel retailer or limited lines travel insurance producer shall provide to prospective purchasers 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; and
(IV) The identity and contact information of the insurer and limited line producer.
oducer shall provide to prospective purchasers 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; and
(IV) The identity and contact information of the insurer and limited line producer.
(c) (I) At the time of licensure, the limited lines travel insurance producer shall establish and maintain a register of each travel retailer that offers travel insurance on the limited lines travel insurance producer's behalf on a form prescribed by the commissioner. The limited lines travel insurance producer must maintain and update the register annually and include:
(A) The name, address, and contact information of each travel retailer;
(B) The name, address, and contact information of an officer or person who directs or controls the travel retailer's operations; and
(C) The travel retailer's federal tax identification number.
(II) The limited lines travel insurance producer shall submit the register to the commissioner upon request. The limited lines travel insurance producer shall also certify that the travel retailer registered is not in violation of 18 U.S.C. sec. 1033.
(III) The grounds for suspension and revocation and the penalties applicable to resident insurance producers under section 10-2-801 are applicable to limited lines travel insurance producers and travel retailers.
(d) The limited lines travel insurance producer must designate one of its employees who is a licensed individual producer as the person responsible for the limited lines travel insurance producer's compliance with the travel insurance laws and rules of the state.
(e) The limited lines travel insurance producer shall require 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, which may be subject to review by the commissioner. The training material must include, at minimum, instructions on the types of insurance offered, ethical sales practices, and required disclosures to prospective customers.
(3) A limited lines travel insurance producer and those registered under its license are exempt from the prelicensure educational requirements in section 10-2-201, continuing education requirements in section 10-2-301, and examination and continuing education requirements in section 10-2-403.
(4) Any travel retailer offering or disseminating travel insurance shall make brochures or other written materials available to prospective purchasers that have been approved by the travel insurer. The materials must include information that, at a minimum:
(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.
(5) A travel retailer's employee or authorized representative who is not licensed as an insurance producer may not:
(a) Evaluate or interpret the technical terms, benefits, or conditions of the offered travel insurance coverage;
(b) Evaluate or provide advice concerning a prospective purchaser's existing insurance coverage; or
evaluate the adequacy of the customer's existing insurance coverage.
(5) A travel retailer's employee or authorized representative who is not licensed as an insurance producer may not:
(a) Evaluate or interpret the technical terms, benefits, or 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 herself out as a licensed insurer, licensed producer, or insurance expert.
(6) Notwithstanding any other provision of law, 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 section is authorized to receive related compensation for the services upon registration by the limited lines travel insurance producer.
(7) Travel insurance may be provided under an individual, group, or blanket policy.
(8) The limited lines travel insurance producer is responsible for the acts of the travel retailer and shall use reasonable means to ensure that the travel retailer complies with this section.
(9) The commissioner may take disciplinary action against a limited lines travel insurance producer pursuant to section 10-2-801.
(10) Any person licensed in a major line of authority as an insurance producer is authorized to sell, solicit, and negotiate travel insurance. A property and casualty insurance producer is not required to be appointed by an insurer in order to sell, solicit, or negotiate travel insurance.
(11) Eligibility and underwriting standards for travel insurance may be developed and provided based on travel protection plans designed for individual or identified marketing or distribution channels, if those standards also meet the state's underwriting standards for inland marine.
(12) The commissioner may promulgate rules necessary to implement this section.
C.R.S. § 10-2-415 Appointment of insurance producer by insurer - continuation - exceptions
10-2-415. Appointment of insurance producer by insurer - continuation - exceptions. (Repealed)
C.R.S. § 10-2-415.5 Appointment of insurance producer - continuation - renewal - exceptions
10-2-415.5. Appointment of insurance producer - continuation - renewal - exceptions. (1) No insurance producer shall claim to be a representative or authorized or appointed agent of, or use any other term implying a contractual relationship with, a particular bail insurance company or accept applications on behalf of the bail insurance company unless the insurance producer becomes through a written contract a producer appointee, appointed by that bail insurance company in accordance with this section, to act in the capacity of an agent of the bail insurance company.
(2) (a) A bail insurance company shall notify the commissioner of each insurance producer appointment. Each bail insurance company shall file with the commissioner, monthly or at such other less frequent intervals as the commissioner may prescribe, a current list of insurance producers that it has appointed to solicit business on its behalf. The list shall contain all relevant appointment information as prescribed by the commissioner, including the effective date of appointment.
(b) Subject to renewal, each insurance producer appointment shall remain in effect until:
(I) The insurance producer's license is allowed to expire, discontinued, or canceled by the insurance producer or revoked by the commissioner; or
(II) Notice of termination of the appointment is filed with the commissioner by the insurer.
(c) (I) A bail insurance company shall not appoint an insurance producer to act as its agent to write bail bonds unless the agent is licensed as an insurance producer authorized to write bail bonds and has completed the prelicensure education required by this paragraph (c) and submitted to the bail insurance company evidence of satisfactory completion of the education. The education must be approved by the division and consist of at least:
(A) Eight clock hours regarding bail bonding, two of which concern the criminal court system, two of which concern bail bond industry ethics, and four of which concern the bail bond laws; and
(B) Sixteen clock hours of training in bail recovery practices that complies with standards established by the peace officers standards and training board under section 24-31-303 (1)(h), C.R.S.
(II) This paragraph (c) does not apply to a person who has successfully completed the required prelicensure training pursuant to section 12-7-102.5, C.R.S., as it existed prior to July 1, 2012.
(III) A bail insurance company failing to comply with this paragraph (c) is subject to discipline under section 10-1-110 or the assessment of a penalty.
(3) Each active insurance producer appointment shall be subject to renewal on October 1 of the renewal year. The division shall provide a list of active insurance producer appointees to the bail insurance company along with a renewal invoice stating the fee required for the renewal of each active insurance producer appointment.
(4) Any appointment that is not renewed on or before October 1 shall be deemed to have expired or been discontinued, effective on that date; except that the commissioner may renew an insurer's appointment upon receipt of the renewal invoice together with the renewal fees due and any applicable late fee.
C.R.S. § 10-2-415.6 Bail bond reports required - repeal
10-2-415.6. Bail bond reports required - repeal. (Repealed)
C.R.S. § 10-2-415.7 Termination of insurance producer bail bonding agent - notice - penalty
10-2-415.7. Termination of insurance producer bail bonding agent - notice - penalty. (1) Upon the termination of the appointment of an insurance producer bail bonding agent, the insurer shall, within fifteen days, notify the commissioner and the appointee of such termination by certified mail.
(2) If the termination of an agent's appointment is for any of the causes listed in section 10-1-128 or 10-2-801, the insurer shall notify the commissioner of the reason and, if the commissioner so requests, the insurer shall provide any information, records, statements, or other data pertaining to the termination that may be used by the division in any action taken under section 10-2-801.
(3) Any information, documents, records, or statements provided pursuant to this section shall be privileged, and there shall be no liability on the part of, nor shall a cause of action of any nature arise against, the division, the insurance company, or any authorized representative for requesting or providing such information, documents, records, or statements; except that such information may be used by the division to pursue administrative or criminal prosecutions.
(4) In addition to any other penalty or liability authorized by law, the failure or refusal of any insurer to comply with the requirements of subsection (1) or (2) of this section shall be cause for the assessment against the insurer of a civil penalty of up to one thousand dollars for each such failure or refusal if, after notice to the insurer and after a hearing in accordance with section 24-4-105, C.R.S., the commissioner finds that the insurer has violated this section.
C.R.S. § 10-2-416 Notification to the commissioner of termination
10-2-416. Notification to the commissioner of termination. (1) Termination for cause. An insurer or authorized representative of the insurer that terminates employment, a contract, or other insurance business relationship with a producer shall notify the commissioner within thirty days following the effective date of the termination, using a format prescribed by the commissioner, if the reason for termination is one of the reasons set forth in this article and article 3 of this title, or the insurer has knowledge the producer was found by a court, government body, or self-regulatory organization authorized by law to have engaged in any of the activities in this article and article 3 of this title. Upon the written request of the commissioner, the insurer shall provide additional information, documents, records, or other data pertaining to the termination or activity of the producer.
(2) Ongoing notification requirement. The insurer or the authorized representative of the insurer shall promptly notify the commissioner, in a format prescribed by the commissioner, if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the commissioner pursuant to subsection (1) of this section had the insurer known of its existence.
(3) Copy of notification to be provided to producer. A copy of the notification pursuant to this subsection (3) shall be provided to the producer pursuant to the following requirements:
(a) Within fifteen days after making the notification required by subsections (1) and (2) of this section, the insurer shall mail a copy of the notification to the producer at the producer's last-known address. If the producer is terminated for cause as listed in section 10-2-801, the insurer shall provide a copy of the notification to the producer at the producer's last-known address by certified mail, return receipt requested and postage prepaid, or by overnight delivery using a nationally recognized carrier.
(b) Within thirty 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 commissioner. 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 commissioner's file and accompany every copy of a report distributed or disclosed for any reason about the producer as permitted under subsection (5) of this section.
(4) Immunities. (a) In the absence of wilful and wanton behavior, an insurer, the authorized representative of the insurer, a producer, the commissioner, or an organization of which the commissioner is a member and that compiles the information and makes it available to other commissioners 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 commissioner, from an insurer or producer or a statement by a terminating insurer or producer to an insurer or producer limited solely and exclusively to whether a termination for cause under this paragraph (a) was reported to the commissioner, if 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.
ement by a terminating insurer or producer to an insurer or producer limited solely and exclusively to whether a termination for cause under this paragraph (a) was reported to the commissioner, if 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) Paragraph (a) of this subsection (4) shall not abrogate or modify any existing statutory or common law privileges or immunities.
(5) Confidentiality. (a) (I) Except as provided in paragraph (e) of this subsection (5), any documents, materials, or other information in the control or possession of the division of insurance that is furnished by an insurer, producer, or employee or agent thereof acting on behalf of the insurer or producer, or obtained by the commissioner in an investigation pursuant to this section, shall not be subject to article 72 of title 24, C.R.S.
(II) The commissioner is authorized to use the documents, materials, or other information in the furtherance of any regulatory or legal action brought as a part of the commissioner's duties.
(b) Neither the commissioner nor any person who received documents, materials, or other information while acting under the authority of the commissioner shall be required to testify in any private civil action concerning any confidential documents, materials, or information subject to paragraph (a) of this subsection (5).
(c) In order to assist in the performance of the commissioner's duties under this article, the commissioner, if the recipient agrees to maintain the confidentiality and privileged status of the document, material, or other information, and has the authority to do so, may:
(I) Share documents, materials, or other information, including the documents, materials, or information subject to paragraph (a) of this subsection (5), with any of the following:
(A) Other state, federal, and international regulatory agencies;
(B) The national association of insurance commissioners or its affiliates or subsidiaries; and
(C) State, federal, and international law enforcement authorities.
(II) 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 regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material, or information received with the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material, or information; and
(III) Enter into agreements governing sharing and use of information consistent with this subsection (5).
(d) 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 commissioner under this section or as a result of sharing as authorized in paragraph (c) of this subsection (5).
(e) Nothing in this article shall preclude the commissioner or the commissioner's designee from releasing final disciplinary actions or closed files, including those portions of the record pertaining to for cause terminations that shall be open to public inspection pursuant to article 72 of title 24, C.R.S., and to a database or other clearinghouse service maintained by the national association of insurance commissioners or its affiliates or subsidiaries.
or the commissioner's designee from releasing final disciplinary actions or closed files, including those portions of the record pertaining to for cause terminations that shall be open to public inspection pursuant to article 72 of title 24, C.R.S., and to a database or other clearinghouse service maintained by the national association of insurance commissioners or its affiliates or subsidiaries.
(f) Nothing in this article shall preclude the commissioner or the commissioner's designee from disclosing any information obtained pursuant to the provisions of this article to any state, federal, or international law enforcement agency for use in any criminal or civil investigation or prosecution, nor shall any such information be considered privileged and confidential in any criminal or civil matter, investigation, or prosecution by a government agency, except as provided in part 3 of article 72 of title 24, C.R.S.
(g) Nothing in this article shall preclude the commissioner or the commissioner's designee from disclosing any information obtained or developed pursuant to the provisions of this article for use in any private civil matter, nor shall any such information be considered privileged or confidential, except as provided in part 3 of article 72 of title 24, C.R.S. Any party in interest may request the commissioner or the commissioner's designee to find that disclosure of such information in any private civil matter shall cause substantial injury to the public interest. If the commissioner finds that disclosure shall cause substantial injury to the public interest, the commissioner or the commissioner's designee may apply to the district court for an order permitting restrictions on disclosure as authorized by section 24-72-204 (6), C.R.S.
(6) Penalties for failing to report. An insurer, the authorized representative of the insurer, or producer that fails to report as required under the provisions of this section or that is found to have reported with actual malice by a court of competent jurisdiction, may, after notice and hearing, have the producer's license or insurer's certificate of authority suspended or revoked and may be fined in accordance with sections 10-2-804 (4) and 10-3-1108.
C.R.S. § 10-2-416.5 Required availability to commissioner of list of producer appointees for enforcement purposes
10-2-416.5. Required availability to commissioner of list of producer appointees for enforcement purposes. Each insurer shall maintain a current list of producers contractually authorized to accept applications on behalf of the insurer. Each insurer shall make such list available to the commissioner upon reasonable request for purposes of conducting investigations and enforcing the provisions of this title.
C.R.S. § 10-2-417 Public insurance adjusters - license required - financial responsibility - standards of conduct - rules
10-2-417. Public insurance adjusters - license required - financial responsibility - standards of conduct - rules. (1) (a) A person shall not act or hold himself or herself out as a public adjuster in this state unless the person is licensed as a public adjuster in accordance with this article. No person who, on or before January 1, 2014, holds a license as a public adjuster previously issued under the laws of this state is required to secure an additional license under this article, but is otherwise subject to this article including complying with the financial responsibility requirements of subsection (2) of this section. The previously issued license is, for all purposes, considered a license issued under this article.
(b) A person licensed as a public adjuster shall not misrepresent to an insured that he or she is an adjuster representing an insurer in any capacity, including acting as an employee of the insurer or acting as an independent adjuster, unless so appointed by an insurer in writing to act on the insurer's behalf for that specific claim or purpose. A licensed public adjuster is prohibited from charging an insured a fee if the public adjuster accepts an appointment by the insurer.
(c) A business entity acting as a public adjuster is required to obtain a public adjuster license. Application shall be made in the form required by the commissioner. Before approving the application, the insurance commissioner shall find that:
(I) The business entity has paid the fees set by the commissioner; and
(II) The business entity has designated a licensed public adjuster responsible for the business entity's compliance with the insurance laws and rules of this state.
(2) (a) Before receiving a license as a public adjuster and for the duration of the license, the applicant shall secure evidence of financial responsibility in a format prescribed by the commissioner through a surety bond executed and issued by an insurer authorized to issue surety bonds in this state, which bond:
(I) Must be in the minimum amount of twenty thousand dollars;
(II) Must be in favor of this state and must specifically authorize recovery by the commissioner on behalf of any person in this state who sustained damages as the result of the applicant's erroneous acts, failure to act, conviction of fraud, or conviction of unfair practices in his or her capacity as a public adjuster; and
(III) Must not be terminated unless at least thirty days' prior written notice is filed with the commissioner and given to the licensee.
(b) The issuer of the evidence of financial responsibility shall notify the commissioner upon termination of the bond, unless otherwise directed by the commissioner.
(c) The commissioner may ask for the evidence of financial responsibility at any time the commissioner deems relevant.
nated unless at least thirty days' prior written notice is filed with the commissioner and given to the licensee.
(b) The issuer of the evidence of financial responsibility shall notify the commissioner upon termination of the bond, unless otherwise directed by the commissioner.
(c) The commissioner may ask for the evidence of financial responsibility at any time the commissioner deems relevant.
(d) The commissioner shall summarily suspend the authority to act as a public adjuster if the evidence of financial responsibility terminates or becomes impaired.
(3) A public adjuster shall not pay a commission, service fee, or other valuable consideration to a person for investigating or settling claims in this state if that person is required to be licensed under this article and is not licensed.
(4) In the event of a catastrophic disaster, no public adjuster shall charge, agree to, or accept as compensation or reimbursement any payment, commission, fee, or other thing of value in excess of ten percent of any insurance settlement or proceeds. No public adjuster shall require, demand, or accept any fee, retainer, compensation, deposit, or other thing of value prior to settlement of a claim.
(5) A public adjuster who receives, accepts, or holds any funds on behalf of an insured towards the settlement of a claim for loss or damage shall deposit the funds in a noninterest-bearing escrow or trust account in a financial institution that is insured by an agency of the federal government in the public adjuster's home state or where the loss occurred.
(6) (a) A public adjuster is obligated, under his or her license, to serve with objectivity and loyalty the interest of his or her client alone and to render to the insured such information, counsel, and service, within the knowledge, understanding, and opinion in good faith of the licensee, as will best serve the insured's insurance claim needs and interests.
(b) A public adjuster shall not solicit, or attempt to solicit, an insured during the progress of a loss-producing occurrence, as defined in the insured's insurance contract.
(c) A public adjuster shall not permit an unlicensed employee or representative of the public adjuster to conduct business for which a license is required under this article.
(d) A public adjuster shall not have a direct or indirect financial interest in any aspect of the claim, other than the salary, fee, commission, or other consideration established in the written contract with the insured.
(e) A public adjuster shall not acquire any interest in salvage of property subject to the contract with the insured unless the public adjuster obtains written permission from the insured after settlement of the claim with the insurer.
(f) A public adjuster shall not refer or direct the insured to get needed repairs or services in connection with a loss from any person:
(I) With whom the public adjuster has a financial interest; or
(II) From whom the public adjuster may receive direct or indirect compensation for the referral.
(g) A public adjuster shall not participate directly or indirectly in the reconstruction, repair, or restoration of damaged property that is the subject of a claim adjusted by the public adjuster.
(h) A public adjuster shall not engage in any other activities that may reasonably be construed as presenting a conflict of interest, including soliciting or accepting any remuneration from, or having a financial interest in, any salvage firm, repair firm, or other firm that obtains business in connection with any claim the public adjuster has a contract or agreement to adjust.
e public adjuster.
(h) A public adjuster shall not engage in any other activities that may reasonably be construed as presenting a conflict of interest, including soliciting or accepting any remuneration from, or having a financial interest in, any salvage firm, repair firm, or other firm that obtains business in connection with any claim the public adjuster has a contract or agreement to adjust.
(i) Public adjusters shall adhere to the following general ethical requirements:
(I) A public adjuster shall not undertake the adjustment of a claim if the public adjuster is not competent and knowledgeable as to the terms and conditions of the insurance coverage or if the adjustment of the claim otherwise exceeds the public adjuster's expertise.
(II) A public adjuster shall not knowingly make any oral or written material misrepresentations or statements which are false and intended to injure any person engaged in the business of insurance to any insured client or potential insured client.
(III) A public adjuster, while licensed in this state, shall not represent or act as a company adjuster or independent adjuster on the same claim.
(IV) (A) The insured may rescind any contract or other form of agreement for representation in a property or casualty loss or claim if the insured exercises this right of rescission in writing addressed to the insurer and the public adjuster and puts the written rescission, postage prepaid, in the United States mail within seventy-two hours after signing a settlement representation agreement. All public adjusters taking a representative agreement to resolve a property or casualty loss or claim on behalf of an insured shall give to the insured written notice of, and direction as to, the ability to exercise the insured's right of rescission.
(B) A public adjuster shall not enter into a contract that prevents an insured from pursuing any civil remedy after the required rescission period under sub-subparagraph (A) of this subparagraph (IV).
(V) A public adjuster shall not enter into a contract or accept a power of attorney that vests in the public adjuster the effective authority to choose the persons who perform repair work.
(VI) A public adjuster shall ensure that all contracts for the public adjuster's services are in writing and set forth all terms and conditions of the engagement.
(j) A public adjuster shall not agree to any loss settlement without the insured's knowledge and consent.
(7) The commissioner may promulgate rules as necessary to carry out this section, including:
(a) Requirements and standards for written contracts between public adjusters and insureds; and
(b) The required retention of records by public adjusters.
C.R.S. § 10-2-418 Bail bonding authority
10-2-418. Bail bonding authority. (1) The division shall advise state court administrators that a person may furnish a bail bond if the person is a licensed insurance producer with a power of attorney from an insurance company, appears on the division's website as an active insurance producer with casualty authority, and is appointed by that insurance company.
(2) The division shall issue credentials to each insurance producer who is appointed by a bail insurance company that clearly identifies the person as holding authority to act as a bail bond agent.
C.R.S. § 10-2-501 Reciprocity
10-2-501. Reciprocity. (1) The commissioner shall waive any requirements for a nonresident license applicant with a valid license from the applicant's home state, except those requirements imposed by section 10-2-502, 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 a nonproducer's 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.
C.R.S. § 10-2-502 Nonresident licensing - qualification
10-2-502. Nonresident licensing - qualification. (1) The commissioner may qualify an applicant as a nonresident, unless the applicant is denied licensure pursuant to section 10-2-801, and shall issue an insurance producer license to any qualified nonresident person in accordance with the following:
(a) The person maintains a license in good standing in the person's home state;
(b) An insurance agency or business entity may qualify as a nonresident if the agency or business entity has its principal office located in another state;
(c) The nonresident person holds a similar license that is awarded on the same basis in the nonresident's home state and for the same line or lines of authority applied for in this state;
(d) The person has submitted the proper request for licensure and has paid the fees set forth by regulation;
(e) The nonresident person has filed with the commissioner a current certification of license status for the purposes set forth in section 10-2-501;
(f) The person has submitted or transmitted to the insurance commissioner the application for licensure that the person submitted to his or her home state, or in lieu of the application, a completed uniform application.
(2) The commissioner may verify the producer's licensing status through the producer database maintained by the national association of insurance commissioners or its affiliates or subsidiaries.
(3) A license issued to a nonresident person shall confer the same rights and privileges as those afforded a resident licensee.
(3.5) 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 days after the change of legal residence. No fee or license application is required.
(4) If the insurance department of the nonresident insurance producer's resident state suspends, terminates, or revokes the producer's insurance license in that state, the nonresident insurance producer shall notify the commissioner and shall return the Colorado nonresident license pursuant to section 10-2-804.
(5) Notwithstanding any other provision of this article, a person licensed as a surplus lines producer in the surplus lines producer's home state shall receive a nonresident surplus lines producer license pursuant to subsection (1) of this section; except that nothing in this section otherwise amends or supercedes any provision of this part 5.
(6) Notwithstanding any other provision of this article, a person licensed as a limited lines credit insurance or other type of limited line producer in the limited line producer's home state shall receive a nonresident limited line producer license, pursuant to subsection (1) of this section, granting the same scope of authority granted under the license issued by the producer's home state. For the purposes of this subsection (6), 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 10-2-407.
C.R.S. § 10-2-503 Commissioner as agent for service of process
10-2-503. Commissioner as agent for service of process. (1) By the filing of the application and issuance of a nonresident insurance producer license, a nonresident insurance producer licensee shall be deemed to have appointed the commissioner and successors in office as said nonresident's agent upon whom all lawful process in any legal proceeding against the nonresident may be served and to have agreed that any such lawful process has the same legal force and validity as personal service of process upon such nonresident.
(2) The commissioner shall, within ten working days after receiving three copies of the process served, forward a copy of such process by registered or certified mail to the person for whom the commissioner has received such process at the nonresident individual's address of record, or, if the nonresident is an insurance agency, at the agency's principal place of business. The commissioner shall keep a record of all process so served.
(3) Service of process upon any such licensee in any action or proceeding instituted by the commissioner under this section shall be made by the commissioner by mailing such process by registered mail to an individual licensee at the licensee's last-known address of record or to an insurance agency licensee at its principal place of business.
C.R.S. § 10-2-601 Financial institutions may sell insurance - where - regulation
10-2-601. Financial institutions may sell insurance - where - regulation. (1) For the purposes of this part 6:
(a) and (b) (Deleted by amendment, L. 97, p. 426, § 1, effective April 24, 1997.)
(c) "Credit insurance" has the same meaning as set forth in section 10-10-103 (2).
(d) "Credit life insurance" means insurance on the life of a debtor pursuant to or in connection with a specific loan or other credit transaction.
(e) "Financial institution" means a state bank, including a bank and trust company chartered by a state, a trust company, a savings and loan association, a credit union, or a national bank and the financial institution is located in this state. "Financial institution" includes federally chartered savings and loan associations and credit unions located in this state.
(2) No financial institution or employee thereof shall be licensed or admitted, directly or indirectly, to sell insurance in this state; except that:
(a) A financial institution or employee thereof may engage in the activities of an insurance producer, an insurance agency, or a business entity in this state and shall be licensed pursuant to this article. Such producers, agencies, and business entities shall be subject to the provisions of this title and rules promulgated pursuant thereto.
(b) Unlicensed employees of financial institutions shall not sell insurance or annuities. Such employees may direct customers to licensed persons.
(c) A financial institution, or any subsidiary, affiliate, or employee thereof, may be licensed to sell insurance, credit insurance, and fixed and variable annuity contracts in accordance with regulations promulgated by the commissioner.
(d) Any financial institution, or any subsidiary, affiliate, or employee thereof, may be permitted to own an insurance company authorized to sell, and that insurance company's employees may be licensed to sell, insurance to guarantee the payment of any amounts due in connection with any securities or obligations described in section 11-57-101, C.R.S.; except that no financial institution, or any subsidiary or affiliate subject to the supervision of the banking board created in section 11-102-103, C.R.S., shall own such an insurance company without the consent of the banking board, and no financial institution subject to the supervision of the financial services board created in section 11-44-101.6, C.R.S., shall own such an insurance company without the consent of the financial services board, and no financial institution shall invest more than ten percent of its capital and surplus in such an insurance company.
(e) Any financial institution, or any subsidiary or affiliate thereof, may own, directly or indirectly, a captive insurance company operating under article 6 of this title.
(f) Any trade association organized primarily to promote the common interests of financial institutions, or an affiliate or subsidiary of such association, may hold stock or other interests in an insurance company, or an affiliate or subsidiary thereof.
(3) and (4) (Deleted by amendment, L. 97, p. 426, § 1, effective April 24, 1997.)
(5) The commissioner shall promulgate such rules as are necessary to implement this part 6.
C.R.S. § 10-2-602 Sale of annuities and insurance by financial institutions - certain tying arrangements prohibited
10-2-602. Sale of annuities and insurance by financial institutions - certain tying arrangements prohibited. (1) In addition to the requirements of section 10-3-1105, no financial institution, or subsidiary or employee of a financial institution, shall extend credit, lease or sell property of any kind, furnish any service, or fix or vary the consideration for any such extension of credit, lease, sale, or service on the condition or requirement that the customer shall obtain an insurance contract or an annuity from such financial institution or any subsidiary or employee.
(2) No financial institution may offer a financial product or service, or fix or vary the conditions of such product or service, conditioned on a requirement that the customer obtain insurance from such financial institution or any specific person.
(3) No person shall require or imply that the purchase of an insurance product, or of an annuity from a financial institution, is a condition of the lending of money or extension of credit, maintenance of a trust account, establishment or maintenance of a checking, savings, deposit, or share account, or the provision of products or services related to such activities.
C.R.S. § 10-2-603 Bank sale of annuities - disclosure requirements
10-2-603. Bank sale of annuities - disclosure requirements. (1) Any financial institution, or any subsidiary or employee thereof, which sells a fixed or variable annuity contract shall receive written acknowledgment from the purchaser that the annuity which is being purchased may involve investment risk and is not insured by the federal deposit insurance corporation or the national credit union share insurance fund. Such written notice shall be clear and conspicuous and shall be given before or contemporaneously with the purchase of the annuity. This subsection (1) shall apply to an affiliate or subsidiary of a financial institution if such an affiliate or subsidiary sells insurance on the premises of a financial institution.
(2) A clear and conspicuous notice substantially in the following form complies with this section:
Acknowledgment
___________________________________
(Complete name of investment)
I understand that the investment product I am purchasing is not a bank deposit and is not an obligation of, nor is it guaranteed by, any bank. This product is not insured or guaranteed by the federal deposit insurance corporation. In addition, I understand that the investment product purchased may be subject to investment risk, including possible loss of principal, and that any investment product's past performance should not be considered an indication of future results.
__________________________________________________
(Date)
(Signed)
C.R.S. § 10-2-604 Disclosures
10-2-604. Disclosures. (1) A financial institution, and any person selling insurance with a cash value or a cash accumulation component on behalf of a financial institution, shall disclose to the financial institution's customers or members, and on any advertisements or promotional material, that insurance offered, recommended, sponsored, or sold by the financial institution, or on the premises of the financial institution:
(a) Is not a deposit;
(b) Is not insured by the federal deposit insurance corporation, the national credit union share insurance fund, or any agency of the state of Colorado or the federal government;
(c) Is not guaranteed by the financial institution or any affiliated insured depository institution;
(d) May involve investment risk, including loss of principal; and
(e) May be purchased from a producer of the customer's choice and that the customer's choice of another insurance provider will not affect the customer's relationship with the financial institution.
C.R.S. § 10-2-605 Misleading advertising
10-2-605. Misleading advertising. (1) No financial institution, or any subsidiary, affiliate, or employee of a financial institution, may issue advertising that would lead a reasonable person to believe that the state of Colorado or the federal government:
(a) Is responsible for insurance sales activities of the financial institution or any subsidiary, affiliate, or employee thereof;
(b) Guarantees any return on insurance products or is a source of payment of any insurance obligations sold by the financial institution or any subsidiary, affiliate, or employee thereof.
C.R.S. § 10-2-606 Discrimination against affiliated agents
10-2-606. Discrimination against affiliated agents. (1) No financial institution shall:
(a) Require, as a condition of providing or renewing a contract for providing a product or service to any customer, that the customer purchase, finance, or negotiate any policy or contract of insurance through any particular person;
(b) In connection with a loan or extension of credit that requires a borrower to obtain insurance, reject an insurance policy solely because such policy has been issued or underwritten by any person who is not associated with such institution;
(c) Impose any requirement on any insurance producer who is not associated with the financial institution that is not imposed on any insurance producer who is associated with such institution; or
(d) Unless otherwise authorized by applicable federal or state law, require any debtor, insurer, or producer to pay a separate charge in connection with the handling of insurance that is required under a contract.
C.R.S. § 10-2-607 Location of sales
10-2-607. Location of sales. To the extent practicable, a financial institution's sale of insurance shall be in a location distinct from a teller window or common teller area. Unlicensed employees of financial institutions shall not sell insurance or annuities. Such employees may direct customers to licensed persons.
C.R.S. § 10-2-701 Assumed names - registration - rules
10-2-701. Assumed names - registration - rules. Any insurance producer using an assumed name, including without limitation a trade or fictitious name, under which the insurance producer conducts business shall register the name with the insurance commissioner prior to using the assumed name. The commissioner shall not accept registration of any name that would tend to be misleading to the public or that is identical or similar to the name of any producer whose license has been revoked or suspended. Every insurance producer licensee shall promptly file with the commissioner a written notice of any change in or discontinuation of the use of any name. The commissioner may promulgate all rules necessary and proper to implement the provisions of this section.
C.R.S. § 10-2-702 Commissions
10-2-702. Commissions. (1) No insurer or insurance producer shall pay, directly or indirectly, any commission, service fee, brokerage, or other valuable consideration to any person selling, soliciting, or negotiating insurance within this state unless, at the time such services were performed, such person was a duly licensed insurance producer under this article for the performance of such services. In addition, no person, other than a person appropriately licensed by this state as an insurance producer at the time such services were performed, shall accept any such consideration; except that any person duly licensed under this article may pay or assign such person's commissions to, or direct that such person's commissions be paid to, a partnership of which the person is a member, employee, or agent or to a corporation of which the person is an officer, employee, or agent. This section shall not prevent payment or receipt of renewal or other deferred commissions to or by any person entitled thereto under this section.
(2) An insurer or insurance producer may pay or assign commissions, service fees, brokerages, or other valuable consideration to an insurance agency, business entity, or persons who do not sell, solicit, or negotiate insurance in this state, unless the payment would violate section 10-3-1104 (1)(g).
C.R.S. § 10-2-703 Countersignature not required
10-2-703. Countersignature not required. (Repealed)
C.R.S. § 10-2-704 Fiduciary responsibilities
10-2-704. Fiduciary responsibilities. (1) (a) All premiums belonging to insurers and all unearned premiums belonging to insureds received by an insurance producer licensee under this article shall be treated by such insurance producer in a fiduciary capacity. The commissioner may promulgate such rules as are necessary and proper relating to the treatment of such premiums.
(b) All premiums received, less commissions if authorized, shall be remitted to the insurer or its agent entitled thereto on or before the contractual due date or, if there is no contractual due date, within forty-five days after receipt.
(c) All returned premiums received from insurers or credited by insurers to the account of the licensee shall be remitted to or credited to the account of the person entitled thereto within thirty days after such receipt or credit.
(d) If any insurance producer has failed to account for any collected premium to the insurer to whom it is owing or to its agent entitled thereto for more than forty-five days after the contractual due date or, if there is no contractual due date, more than ninety days after receipt, the insurer or its agent shall promptly report such failure to the commissioner in writing.
(2) Every insurer shall remit unearned premiums to the insured or the proper agent, or shall otherwise credit the account of the proper licensee, as soon as is practicable after entitlement thereto has been established, but in no event more than forty-five days after the effective date of any cancellation or termination effected by the insurer or after the date of entitlement thereto as established by notification of cancellation or of termination or as otherwise established. It shall be the responsibility of any insurance producer having knowledge of a failure on the part of any insurer to comply with this subsection (2) to promptly report such failure to the commissioner in writing.
(3) No insurance producer under this article shall commingle premiums belonging to insurers and returned premiums belonging to insureds with the producer's personal funds or with any other funds except those directly connected with the producer's insurance business.
(4) Any insurer that delivers, in this state, a policy of insurance to an insurance producer representing the interest of the insured upon the application or request of such producer shall be deemed to have authorized such producer to receive on the insurer's behalf any premium due upon issuance or delivery of the policy; and the insurer shall be deemed to have so authorized the producer.
C.R.S. § 10-2-705 Bail bond documents - requirements - rules
10-2-705. Bail bond documents - requirements - rules. (1) The insurance producer who posts a bail bond with the court on behalf of a defendant shall ensure that the following documents comply with the following provisions:
(a) An indemnity agreement must:
(I) Be in writing;
(II) Be signed by the producer;
(III) Be signed by the defendant or indemnitor;
(IV) Set forth the amount of bail set in the case, the name of the defendant released on the bail bond, the court case number if available, the court where the bond is executed, the premium charged, the amount and type of collateral held by the insurance producer, and the conditions under which the collateral is returned;
(V) Contain documentation that the indemnitor has received copies of signed and dated disclosure forms; and
(VI) If the defendant or indemnitor is illiterate or does not read English, contain a note on the indemnity agreement that the producer or a third party has read or translated the agreement to the defendant or indemnitor and be affixed with an affidavit to the indemnity agreement attesting that the document was translated;
(b) A promissory note must be:
(I) In writing;
(II) Signed by the producer; and
(III) Signed by the defendant or indemnitor;
(c) A collateral receipt must:
(I) Be dated;
(II) Be in writing;
(III) Be signed by the producer;
(IV) Be signed by the defendant or indemnitor;
(V) Be prenumbered;
(VI) Contain a full description of the collateral, including the condition of the collateral at the time it is taken into custody; and
(VII) Set forth the amount of bail set in the case, the name of the defendant released on the bail bond, the court case number, the court where the bond is executed, the premium charged, the amount and type of collateral held by the insurance producer, and the conditions under which the collateral is returned;
(d) A bail bond revocation request must be:
(I) Dated;
(II) In writing;
(III) Signed by the producer; and
(IV) Signed by the defendant or indemnitor.
(2) (a) Before accepting consideration, the insurance producer who writes bail bonds shall commit to writing, sign, date, and obtain the defendant's or indemnitor's signature on an arrangement for the payment of all or part of the premium, commission, or fee, including the payment schedule. The signature of the insurance producer who writes bail bonds is not an obligation to pay any debt owed to a lender. To be enforceable, interest and financial charges on any unpaid premium must comply with the "Uniform Consumer Credit Code", articles 1 to 9 of title 5, C.R.S.
(b) Before accepting consideration or taking collateral, the insurance producer who writes bail bonds shall provide, in a form prescribed by the commissioner, a disclosure statement to each defendant and indemnitor detailing the terms of the bail bond.
(3) (a) An insurance producer who posts a bail bond with the court and who accepts consideration for a bail bond or undertaking shall, for each payment received, provide to the person tendering payment a prenumbered, signed receipt containing the following:
(I) The date;
(II) The defendant's name;
(III) A description of the consideration and amount of money received;
(IV) The purpose for which it was received;
(V) The number of any power-of-attorney form attached to the bail bond;
(VI) The penal sum of the bail bond;
(VII) The name of the person tendering payment; and
(VIII) The terms under which the money or other consideration is released.
(I) The date;
(II) The defendant's name;
(III) A description of the consideration and amount of money received;
(IV) The purpose for which it was received;
(V) The number of any power-of-attorney form attached to the bail bond;
(VI) The penal sum of the bail bond;
(VII) The name of the person tendering payment; and
(VIII) The terms under which the money or other consideration is released.
(b) The insurance producer who posts a bail bond with the court shall provide the person tendering payment a signed and dated receipt for each premium payment listing the amount paid.
(3.5) (a) If the bond is to be secured by real estate, the bail bonding agent shall provide the property owner with a written disclosure statement in the following form at the time an initial application is filed:
Disclosure of lien against real property
Do not sign this document until you read and understand it! This bail bond will be secured by real property you own or in which you have an interest. Failure to pay the bail bond premiums when due or the defendant's failure to comply with the conditions of bail could result in the loss of your property!
(b) The disclosure required in paragraph (a) of this subsection (3.5) shall be printed in fourteen-point, bold-faced type either:
(I) On a separate and specific document attached to or accompanying the application; or
(II) In a clear and conspicuous statement on the face of the application.
(c) Before a property owner executes any instrument creating a lien against real property, the bail bonding agent shall provide the property owner with a completed copy of the instrument creating the lien against real property and the disclosure statement described in paragraph (a) of this subsection (3.5). If a bail bonding agent fails to comply fully with the requirements of paragraphs (a) and (b) of this subsection (3.5) and this paragraph (c), any instrument creating a lien against real property shall be voidable.
(d) The bonding agent shall deliver to the property owner a fully executed and notarized reconveyance of title, a certificate of discharge, or a full release of any lien against real property that secures performance of the conditions of a bail bond within thirty-five days after receiving notice that the time for appealing an order that exonerated the bail bond has expired. The bonding agent shall also deliver to the property owner the original canceled note as evidence that the indebtedness secured by any lien instrument has been paid or that the purposes of said instrument have been fully satisfied and the original deed of trust, security agreement, or other instrument that secured the bail bond obligation. If a timely notice of appeal is filed, the thirty-five-day period shall begin on the day the appellate court's affirmation of the order becomes final. If the bonding agent fails to comply with the requirements of this paragraph (d), the property owner may petition the district court to issue an order directing the clerk of such court to execute a full reconveyance of title, a certificate of discharge, or a full release of any lien against real property created to secure performance of the conditions of the bail bond. The petition shall be verified and shall allege facts showing that the bonding agent has failed to comply with the provisions of this paragraph (d).
strict court to issue an order directing the clerk of such court to execute a full reconveyance of title, a certificate of discharge, or a full release of any lien against real property created to secure performance of the conditions of the bail bond. The petition shall be verified and shall allege facts showing that the bonding agent has failed to comply with the provisions of this paragraph (d).
(e) Any bail bonding agent who violates this subsection (3.5) is liable to the property owner for all damages that may be sustained by reason of the violation, plus statutory damages in the sum of three hundred dollars. The property owner shall be entitled to recover court costs and reasonable attorney fees, as determined by the court, upon prevailing in any action brought to enforce the provisions of this subsection (3.5).
(4) The insurance producer shall prepare or execute separate agreements and documents for each time the producer posts a bail bond with the court. The producer shall give the indemnitor a copy of each document executed in the course of the bail bond transaction.
(5) For three years after the date of discharge of a bail bond and return of any collateral or proof of notice to the defendant or indemnitor that any promissory note has been satisfied, the insurance producer who posts the bail bond with the court shall keep at the producer's business copies of each receipt, indemnity agreement, bond, disclosure statement, payment plan, bond revocation request, or other document or information related to the bond transaction the commissioner reasonably requires by rule and shall make these documents available for inspection by the commissioner or the commissioner's authorized representative during normal business hours.
(6) The indemnitor may be the defendant.
(7) The commissioner may examine the business practices, books, and records of any insurance producer as often as the commissioner deems appropriate.
C.R.S. § 10-2-706 Insurance producer designee - responsibility
10-2-706. Insurance producer designee - responsibility. An insurance producer may use another properly licensed and appointed insurance producer as an agent to comply with the requirements of section 10-2-705, but the insurance producer who posts the bail bond with the court is responsible for compliance with section 10-2-705 and is subject to discipline for noncompliance with any provision of section 10-2-705.
C.R.S. § 10-2-707 Business practices - price limits - collateral
10-2-707. Business practices - price limits - collateral. (1) An insurance producer who writes bail bonds shall not charge a premium or commission of more than the greater of fifty dollars or fifteen percent of the amount of bail furnished. An insurance producer who writes bail bonds shall not assess fees for any bail bond posted by the producer with the court unless the fee is for payment of a bail bond filing charged by a court or law enforcement agency, the fee is for the actual cost of storing collateral in a secure, self-service public storage facility, or the fee is for premium financing.
(2) If an insurance producer who posts the bail bond with the court has issued a disclosure statement in accordance with section 10-2-705 (2)(b), the producer may use collateral received from the defendant or indemnitor to secure the following obligations:
(a) Compliance with the bond issued on behalf of the principal;
(b) Any balance due on the premium, commission, or fee for the bail bond; and
(c) Any actual costs incurred by the insurance producer as a result of issuing the bail bond.
(3) Subject to section 16-4-110 (1)(c) and (2), a bail premium is earned in its entirety by a compensated surety upon the defendant's release from custody.
C.R.S. § 10-2-801 Licenses - denial, suspension, revocation, termination - reporting of actions - definitions
10-2-801. Licenses - denial, suspension, revocation, termination - reporting of actions - definitions. (1) The commissioner may place an insurance producer on probation; suspend, revoke, or refuse to issue, continue, or renew an insurance producer license; order restitution to be paid from an insurance producer; or assess a civil penalty pursuant to section 10-2-804 or 10-3-1108, if, after notice to the insurance producer licensee and after a hearing held in accordance with sections 24-4-104 and 24-4-105, C.R.S., the commissioner finds that as to the licensee or applicant any one or more of the following conditions exist:
(a) Any incorrect, misleading, incomplete, or materially untrue information in the license application;
(b) Any cause for which issuance of the license could have been refused had it then existed and been known to the commissioner at the time of issuance;
(c) Violation of, or noncompliance with, section 18-13-130, C.R.S., or any insurance law, or violation of any lawful rule, order, or subpoena of the commissioner or of the insurance department of another state;
(d) Obtaining or attempting to obtain any such license through misrepresentation or fraud;
(e) Improperly withholding, misappropriating, or converting to the licensee's or applicant's own use any moneys or property belonging to policyholders, insurers, beneficiaries, or others received in the course of the business of insurance;
(f) Misrepresentation of the terms of any actual or proposed insurance contract or application for insurance;
(g) (I) Conviction of a felony or misdemeanor involving moral turpitude.
(II) For the purposes of this paragraph (g), "moral turpitude" shall include any sexual offense against a child as defined in section 18-3-411, C.R.S.
(h) Commission of any unfair trade practice or fraud;
(i) The use of fraudulent, coercive, or dishonest practices or demonstrating incompetence, untrustworthiness, or financial irresponsibility in this state or elsewhere;
(j) Suspension, revocation, or denial of an insurance license in any other state, province, district, or territory;
(k) Forgery of another's name to an application for insurance or to any document related to an insurance transaction;
(l) Cheating on an examination, including, but not limited to, improperly using notes or any other reference material to complete an examination for an insurance license;
(m) Failure to fully meet the licensing requirements;
(n) Knowingly accepting insurance business from a person who is not licensed;
(o) Failing to comply with an administrative or court order imposing a child support obligation;
(p) Failing to pay state income tax or comply with any administrative or court order directing payment of state income tax; or
(q) Profiting either directly or indirectly from the business of a cash-bonding agent or professional cash-bail agent unless the person profiting is registered as a cash-bonding agent or professional cash-bail agent and the profit is derived from their own business.
(1.5) The commissioner shall revoke the license of an insurance producer licensee if, after notice to the insurance producer licensee and after a hearing held in accordance with sections 24-4-104 and 24-4-105, C.R.S., the commissioner finds that the licensee was convicted under section 18-5-211, C.R.S.
(2) In the event that the action by the commissioner is to not renew or continue or to deny an application for a license, the commissioner shall notify the applicant or licensee of the reasons for such action and advise, in writing, the applicant or licensee of the reason for the denial or nonrenewal of the applicant's or licensee's license.
e licensee was convicted under section 18-5-211, C.R.S.
(2) In the event that the action by the commissioner is to not renew or continue or to deny an application for a license, the commissioner shall notify the applicant or licensee of the reasons for such action and advise, in writing, the applicant or licensee of the reason for the denial or nonrenewal of the applicant's or licensee's license.
(3) (a) A producer or business entity shall report to the commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state within thirty days after the final disposition of the matter. This report shall include a copy of the order, consent to order, or other relevant legal document.
(b) A producer shall report within thirty days after the conviction to the commissioner if he or she is convicted under section 18-5-211, C.R.S.
(4) Within thirty days after the initial pretrial hearing date, a producer or business entity shall report to the commissioner any criminal prosecution of the producer in any jurisdiction. The report shall include a copy of the initial complaint, the order resulting from the hearing, and any other relevant legal documents.
(5) If the commissioner revokes the license of an insurance producer pursuant to this section, or if an insurance producer surrenders its license to avoid discipline by the commissioner, the insurance producer shall not be eligible to apply for a new insurance producer license for two years after the date the license is revoked or surrendered and returned to the commissioner pursuant to section 10-2-802 (1).
(6) For the purposes of this section, "restitution" means benefits or moneys owed due to the regulated entity's violation of this title.
C.R.S. § 10-2-802 Surrender of license
10-2-802. Surrender of license. (1) An insurance producer license issued under this article, although issued and delivered to the licensee, shall at all times be the property of the state of Colorado and shall be surrendered or returned promptly to the commissioner by personal delivery or by certified or registered mail within fifteen days under any of the following conditions:
(a) Suspension, revocation, or termination of the license;
(b) Discontinuation or nonrenewal of the license by the licensee;
(c) Cessation of residency in this state or, in the case of a nonresident licensee, cessation of residency in the licensee's resident state; or
(d) Suspension, termination, or revocation of a nonresident licensee's license in the state of residence.
(2) The commissioner may require surrender of an insurance producer license for any proper reason in addition to the grounds stated in subsection (1) of this section.
(3) As to any insurance producer license issued pursuant to this article which is lost, stolen, or destroyed while in the possession of the licensee, the commissioner may accept, in lieu of return of the license, the affidavit of the individual licensee or, in the case of an insurance agency or business entity, the person given responsibility for custody of the license, as to the facts concerning such loss, theft, or destruction.
C.R.S. § 10-2-803 Notice of penalty, suspension, termination, revocation, or denial
10-2-803. Notice of penalty, suspension, termination, revocation, or denial. (1) The commissioner shall promptly notify any insurance producer licensee regarding any penalty assessed, suspension, revocation, termination, or denial of the licensee's license by the commissioner.
(2) Upon assessment of a penalty, suspension, revocation, or termination of the license of a resident licensee, the commissioner shall notify the central office of the national association of insurance commissioners or its affiliate or subsidiary.
C.R.S. § 10-2-804 Investigation by commissioner
10-2-804. Investigation by commissioner. (1) The commissioner may examine and investigate the business affairs and conduct of every person applying for or holding an insurance producer license under this article to determine whether such person has been or is engaged in any violation of the insurance laws or rules of this state or has engaged in unfair or deceptive acts or practices in any state.
(2) On receipt of any information regarding the possible violation of the insurance laws or rules of this or any other state, or the possible use of unfair or deceptive practices by a person applying for or holding an insurance producer license under this article, the commissioner may require such person to appear and show cause why the commissioner should not discontinue, revoke, suspend, or refuse to issue or renew the person's license and may, upon the failure of such person to show cause, revoke, suspend, or refuse to issue or renew the license.
(3) The license of an insurance agency or business entity may be suspended or revoked or the renewal or continuation refused if the commissioner finds, after hearing, that an individual licensee's violation was known or should have been known to one or more of the partners, officers, or managers acting on behalf of the insurance agency or business entity, including any foreign or domestic entity as defined in section 7-90-102, C.R.S., and that such violation was not reported to the division of insurance nor corrective action taken in relation thereto.
(4) In addition to or in lieu of any applicable denial, suspension, or revocation of an insurance producer license, any person who violates any provision of this article may, after hearing, be subject to any remedy or civil penalty of not more than three thousand dollars for each such violation.
(5) The commissioner shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by this article against any person who is under investigation for or charged with a violation of this article even if the person's license has been surrendered or has lapsed by operation of law.
C.R.S. § 10-2-901 Short title
10-2-901. Short title. This part 9 shall be known and may be cited as the "Reinsurance Intermediary Act".
C.R.S. § 10-2-902 Definitions
10-2-902. Definitions. As used in this part 9, unless the context otherwise requires:
(1) "Controlling person" means any person, firm, association, or corporation that directly or indirectly has the power to direct or cause to be directed, the management, control, or activities of the reinsurance intermediary.
(2) "Insurer" means any person, firm, association, or corporation duly licensed in this state pursuant to applicable provisions of the insurance laws as an insurer.
(3) "Licensed producer" means an insurance producer or reinsurance intermediary licensed in this state pursuant to applicable provisions of the insurance laws.
(4) "Reinsurance intermediary" means a reinsurance intermediary-producer as defined in subsection (6) of this section or a reinsurance intermediary-manager as defined in subsection (5) of this section.
(5) "Reinsurance intermediary-manager", referred to in this part 9 as "RM", means any person, firm, association, or corporation that has authority to bind or manages all or part of the assumed reinsurance business of a reinsurer (including the management of a separate division, department, or underwriting office) and acts as an agent for such reinsurer whether known as an RM, manager, or other similar term. Notwithstanding the provisions of this subsection (5), the following persons shall not be considered an RM, with respect to such reinsurer, for the purposes of this part 9:
(a) An employee of the reinsurer;
(b) A United States manager of the United States branch of an alien reinsurer;
(c) An underwriting manager who, pursuant to contract, manages all the reinsurance operations of the reinsurer and who is under common control with the reinsurer subject to the provisions of part 8 of article 3 of this title and whose compensation is not based on the volume of premiums written;
(d) The manager of a group, association, pool, or organization of insurers which engage in joint underwriting or joint reinsurance and are subject to examination by the commissioner or the equivalent insurance regulatory authority of the state in which the manager's principal business office is located.
(6) "Reinsurance intermediary-producer", referred to in this part 9 as "RP", means any person, other than an officer or employee of the ceding insurer, firm, association, or corporation, that solicits, negotiates, or places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority or power to bind reinsurance on behalf of such insurer.
(7) "Reinsurer" means any person, firm, association, or corporation duly licensed in this state pursuant to the applicable provisions of the insurance laws as an insurer with the authority to assume reinsurance.
(8) "To be in violation" means that the reinsurance intermediary, insurer, or reinsurer for whom the reinsurance intermediary was acting failed to substantially comply with the provisions of this part 9.
C.R.S. § 10-2-903 Licensure
10-2-903. Licensure. (1) No person, firm, association, or corporation shall act as an RP in this state if the RP maintains an office either directly or as a member or employee of a firm or association, or an officer, director, or employee of a corporation:
(a) In this state, unless such RP is a licensed producer in this state; or
(b) In another state, unless such RP is a licensed producer in this state or another state having a law substantially similar to this part 9, or such RP is licensed in this state as a nonresident reinsurance intermediary.
(2) No person, firm, association, or corporation shall act as an RM:
(a) For a reinsurer domiciled in this state, unless such RM is a licensed producer in this state;
(b) In this state, if the RM maintains an office either directly or as a member or employee of a firm or association, or an officer, director, or employee of a corporation in this state, unless such RM is a licensed producer in this state;
(c) In another state for a nondomestic insurer, unless such RM is a licensed producer in this state or another state having a law substantially similar to this part 9 or such person is licensed in this state as a nonresident reinsurance intermediary.
(3) The commissioner may require an RM subject to subsection (2) of this section to:
(a) File a bond in an amount from an insurer acceptable to the commissioner for the protection of the reinsurer; and
(b) Maintain an errors and omissions policy in an amount acceptable to the commissioner.
(4) (a) The commissioner may issue a reinsurance intermediary license to any person, firm, association, or corporation that has complied with the requirements of this part 9. Any such license issued to a firm or association will authorize all the members of such firm or association and any designated employees to act as reinsurance intermediaries under the license, and all such persons shall be named in the application and any supplements thereto. Any such license issued to a corporation shall authorize all of the officers, and any designated employees and directors thereof to act as reinsurance intermediaries on behalf of such corporation, and all such persons shall be named in the application and any supplements thereto.
(b) If the applicant for a reinsurance intermediary license is a nonresident, such applicant, as a condition precedent to receiving or holding a license, shall designate the commissioner as agent for service of process in the manner, and with the same legal effect, provided for by this part 9 for designation of service of process upon unauthorized insurers; and also shall furnish the commissioner with the name and address of a resident of this state upon whom notices or orders of the commissioner or process affecting such nonresident reinsurance intermediary may be served. Such licensee shall promptly notify the commissioner in writing of every change in its designated agent for service of process, and such change shall not become effective until acknowledged by the commissioner.
(5) The commissioner may refuse to issue a reinsurance intermediary license if, in the commissioner's judgment, the applicant, any one named on the application, or any member, principal, officer, or director of the applicant, is not trustworthy, or that any controlling person of such applicant is not trustworthy to act as a reinsurance intermediary, or that any individual specified in this subsection (5) has given cause for revocation or suspension of such license, or has failed to comply with any prerequisite for the issuance of such license. Upon written request therefor, the commissioner shall furnish a summary of the basis for refusal to issue a license, which document shall be privileged and not subject to the provisions of part 2 of article 72 of title 24, C.R.S.
(6) Licensed attorneys at law of this state when acting in their professional capacity as such shall be exempt from this section.
C.R.S. § 10-2-904 Required contract provisions - reinsurance intermediary-producers
10-2-904. Required contract provisions - reinsurance intermediary-producers. (1) Transactions between an RP and the insurer such RP represents shall only be entered into pursuant to a written authorization specifying the responsibilities of each party. The authorization shall, at a minimum, contain provisions that:
(a) The insurer may terminate the RP's authority at any time;
(b) The RP shall render accounts to the insurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the RP, and remit all funds due to the insurer within thirty days of receipt;
(c) All funds collected for the insurer's account shall be held by the RP in a fiduciary capacity in a bank which is a qualified United States financial institution;
(d) The RP shall comply with section 10-2-905;
(e) The RP shall comply with the written standards established by the insurer for the cession or retrocession of all risks;
(f) The RP shall disclose to the insurer any relationship with any reinsurer to which business will be ceded or retroceded.
C.R.S. § 10-2-905 Books and records - reinsurance intermediary-producers
10-2-905. Books and records - reinsurance intermediary-producers. (1) For at least ten years after expiration of each contract of reinsurance transacted by the RP, the RP shall keep a complete record for each transaction showing:
(a) The type of contract, limits, underwriting restrictions, classes, or risks and territory;
(b) The period of coverage, including effective and expiration dates, cancellation provisions, and notice required of cancellation;
(c) The reporting and settlement requirements of balances;
(d) The rate used to compute the reinsurance premium;
(e) The names and addresses of assuming reinsurers;
(f) The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the RP;
(g) Related correspondence and memoranda;
(h) Proof of placement;
(i) Details regarding retrocessions handled by the RP including the identity of retrocessionaires and the percentage of each contract assumed or ceded;
(j) Financial records, including but not limited to premium and loss accounts; and
(k) When the RP procures a reinsurance contract on behalf of a licensed ceding insurer:
(I) Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
(II) If placed through a representative of the assuming reinsurer, other than an employee, written evidence that such reinsurer has delegated binding authority to the representative.
(2) The insurer shall have access and the right to copy and audit all accounts and records maintained by the RP related to its business in a form usable by the insurer.
C.R.S. § 10-2-906 Duties of insurers utilizing the services of a reinsurance intermediary-producer
10-2-906. Duties of insurers utilizing the services of a reinsurance intermediary-producer. (1) An insurer shall not engage the services of any person, firm, association, or corporation to act as an RP on its behalf unless such person is licensed as required by section 10-2-903 (1).
(2) An insurer may not employ an individual who is employed by an RP with which it transacts business, unless such RP is under common control with the insurer and subject to the provisions of part 8 of article 3 of this title.
(3) The insurer shall annually obtain a copy of statements of the financial condition of each RP with which it transacts business.
C.R.S. § 10-2-907 Required contract provisions - reinsurance intermediary-managers
10-2-907. Required contract provisions - reinsurance intermediary-managers. (1) Transactions between an RM and the reinsurer such RM represents shall only be entered into pursuant to a written contract specifying the responsibilities of each party, which shall be approved by the reinsurer's board of directors. At least thirty days before such reinsurer assumes or cedes business through such producer, a true copy of the approved contract shall be filed with the commissioner for approval. The contract shall, at a minimum, contain provisions that incorporate all of the following:
(a) The reinsurer may terminate the contract for cause upon written notice to the RM. The reinsurer may suspend the authority of the RM to assume or cede business during the pendency of any dispute regarding the cause for termination.
(b) The RM shall render accounts to the reinsurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the RM, and remit all funds due under the contract to the reinsurer on not less than a monthly basis;
(c) All funds collected for the reinsurer's account shall be held by the RM in a fiduciary capacity in a bank that is a qualified United States financial institution as defined in section 10-1-102 (17). The RM may retain no more than three months' estimated claims payments and allocated loss adjustment expenses. The RM shall maintain a separate bank account for each reinsurer that such RM represents.
(d) For at least ten years after expiration of each contract of reinsurance transacted by the RM, the RM shall keep a complete record for each transaction showing:
(I) The type of contract, limits, underwriting restrictions, classes, or risks and territory;
(II) The period of coverage, including effective and expiration dates, cancellation provisions, notice required for cancellation, and disposition of outstanding reserves on covered risks;
(III) The reporting and settlement requirements of balances;
(IV) The rate used to compute the reinsurance premium;
(V) The names and addresses of reinsurers;
(VI) The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the RM;
(VII) Related correspondence and memoranda;
(VIII) Proof of placement;
(IX) Details regarding retrocessions handled by the RM, as permitted by section 10-2-909 (4), including the identity of retrocessionaires and percentage of each contract assumed or ceded;
(X) Financial records, including but not limited to premium and loss accounts; and
(XI) When the RM places a reinsurance contract on behalf of a ceding insurer:
(A) Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
(B) If placed through a representative of the assuming reinsurer, other than an employee, written evidence that such reinsurer has delegated binding authority to the representative;
(e) The reinsurer shall have access and the right to copy all accounts and records maintained by the RM related to such RM's business in a form usable by the reinsurer;
(f) The contract cannot be assigned in whole or in part by the RM;
(g) The RM shall comply with the written underwriting and rating standards established by the insurer for the acceptance, rejection, or cession of all risks;
(h) The contract sets forth the rates, terms, and purposes of commissions, charges, and other fees which the RM may levy against the reinsurer;
orm usable by the reinsurer;
(f) The contract cannot be assigned in whole or in part by the RM;
(g) The RM shall comply with the written underwriting and rating standards established by the insurer for the acceptance, rejection, or cession of all risks;
(h) The contract sets forth the rates, terms, and purposes of commissions, charges, and other fees which the RM may levy against the reinsurer;
(i) (I) If the contract permits the RM to settle claims on behalf of the reinsurer, all claims shall be reported to the reinsurer in a timely manner.
(II) A copy of the claim file shall be sent to the reinsurer at its request or as soon as it becomes known that the claim:
(A) Has the potential to exceed the lesser of an amount determined by the commissioner or the limit set by the reinsurer;
(B) Involves a coverage dispute;
(C) May exceed the RM claims settlement authority;
(D) Is open for more than six months; or
(E) Is closed by payment of the lesser of an amount set by the commissioner or an amount set by the reinsurer;
(III) All claim files shall be the joint property of the reinsurer and RM; however, upon an order of liquidation of the reinsurer, such files shall become the sole property of the reinsurer or its estate; the RM shall have reasonable access to and the right to copy the files on a timely basis;
(IV) Any settlement authority granted to the RM may be terminated for cause upon the reinsurer's written notice to the RM or upon the termination of the contract. The reinsurer may suspend the settlement authority during the pendency of the dispute regarding the cause of termination.
(j) If the contract provides for a sharing of interim profits by the RM, that such interim profits will not be paid until one year after the end of each underwriting period for property business and five years after the end of each underwriting period for casualty business or a later period set by the commissioner for specified lines of insurance and not until the adequacy of reserves on remaining claims has been verified pursuant to section 10-2-909 (3);
(k) The RM shall annually provide the reinsurer with a statement of its financial condition prepared by an independent certified accountant;
(l) The reinsurer shall periodically and at least semiannually conduct an on-site review of the underwriting and claims processing operations of the RM;
(m) The RM shall disclose to the reinsurer any relationship such RM has with any insurer prior to ceding or assuming any business with such insurer pursuant to the contract;
(n) The acts of the RM shall be deemed to be the acts of the reinsurer on whose behalf it is acting.
C.R.S. § 10-2-908 Prohibited acts
10-2-908. Prohibited acts. (1) The RM shall not:
(a) Bind retrocessions on behalf of the reinsurer; except that the RM may bind facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for such retrocessions. Such guidelines shall include a list of reinsurers with which such automatic agreements are in effect, and for each such reinsurer, the coverages and amounts or percentages that may be reinsured, and commission schedules.
(b) Commit the reinsurer to participate in reinsurance syndicates;
(c) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of reinsurance for which he is appointed;
(d) Without prior approval of the reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions, that exceeds the lesser of an amount specified by the reinsurer or one percent of the reinsurer's policyholder's surplus as of December 31 of the last complete calendar year;
(e) Collect any payment from a retrocessionaire or commit the reinsurer to any claim settlement with a retrocessionaire, without prior approval of the reinsurer. If prior approval is given, a report shall be promptly forwarded to the reinsurer.
(f) Jointly employ an individual who is employed by the reinsurer;
(g) Appoint a sub-RM.
C.R.S. § 10-2-909 Duties of reinsurers utilizing the services of a reinsurance intermediary-manager
10-2-909. Duties of reinsurers utilizing the services of a reinsurance intermediary-manager. (1) A reinsurer shall not engage the services of any person, firm, association, or corporation to act as an RM on its behalf unless such person is licensed as required by section 10-2-903 (2).
(2) The reinsurer shall annually obtain a copy of statements of the financial condition of each RM which such reinsurer has engaged prepared by an independent certified accountant in a form acceptable to the commissioner.
(3) If an RM establishes loss reserves, the reinsurer 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 RM. This opinion shall be in addition to any other required loss reserve certification.
(4) Binding authority for all retrocessional contracts or participation in reinsurance syndicates shall rest with an officer of the reinsurer who shall not be affiliated with the RM.
(5) Within thirty days of termination of a contract with an RM, the reinsurer shall provide written notification of such termination to the commissioner.
(6) A reinsurer shall not appoint to its board of directors, any officer, director, employee, controlling shareholder, or subproducer of its RM. This subsection (6) shall not apply to relationships governed by part 8 of article 3 of this title.
C.R.S. § 10-2-910 Examination authority
10-2-910. Examination authority. (1) A reinsurance intermediary shall be subject to examination by the commissioner. The commissioner shall have access to all books, bank accounts, and records of the reinsurance intermediary in a form usable to the commissioner.
(2) An RM may be examined as if it were the reinsurer.
C.R.S. § 10-2-911 Penalties and liabilities
10-2-911. Penalties and liabilities. (1) A reinsurance intermediary, insurer, or reinsurer found by the commissioner, after a hearing conducted in accordance with article 4 of title 24, C.R.S., to be in violation of any provision of this part 9 shall:
(a) For each separate violation, pay a penalty in an amount not to exceed five thousand dollars;
(b) Be subject to revocation or suspension of its license; and
(c) If a violation was committed by the reinsurance intermediary, such reinsurance intermediary shall make restitution to the insurer, reinsurer, rehabilitator, or liquidator of the insurer or reinsurer for the net losses incurred by the insurer or reinsurer attributable to such violation.
(2) The decision, determination, or order of the commissioner pursuant to subsection (1) of this section shall be subject to judicial review by the court of appeals pursuant to section 24-4-106 (11), C.R.S.
(3) Nothing contained in this section shall affect the right of the commissioner to impose any other penalties provided in this title.
(4) Nothing contained in this part 9 is intended to or shall in any manner limit or restrict the rights of policyholders, claimants, creditors, or other third parties or confer any rights to such persons.
C.R.S. § 10-2-912 Rules and regulations
10-2-912. Rules and regulations. The commissioner may adopt reasonable rules and regulations for the implementation and administration of the provisions of this part 9.
C.R.S. § 10-2-1001 Short title
10-2-1001. Short title. This part 10 shall be known and may be cited as the "Managing General Agents Act".
C.R.S. § 10-2-1002 Definitions
10-2-1002. Definitions. As used in this part 10, unless the context otherwise requires:
(1) "Insurer" means any person, firm, association, or corporation duly licensed in this state as an insurance company pursuant to the applicable provisions of the insurance laws.
(2) (a) "Managing general agent", referred to in this part 10 as "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 percent of the policyholder surplus as reported in the last annual statement of the insurer in any one quarter or year together with one or both of the following:
(I) Adjusts or pays claims in excess of an amount determined by the commissioner; or
(II) Negotiates reinsurance on behalf of the insurer.
(b) Notwithstanding the provisions of paragraph (a) of this subsection (2), the following persons shall not be considered an MGA for the purposes of this part 10:
(I) An employee of the insurer;
(II) A United States manager of the United States branch of an alien insurer;
(III) An underwriting manager who, pursuant to contract, manages all the insurance operations of the insurer and who is under common control with the insurer subject to the provisions of part 8 of article 3 of this title and whose compensation is not based on the volume of premiums written;
(IV) The attorney-in-fact authorized by and acting for the subscribers of a reciprocal insurer or interinsurance exchange under powers of attorney.
(3) "Underwrite" means the authority to accept or reject risk on behalf of the insurer.
C.R.S. § 10-2-1003 Licensure
10-2-1003. Licensure. (1) No person, firm, association, or corporation shall act in the capacity of an MGA with respect to risks located in this state for an insurer licensed in this state unless such person is a licensed producer in this state.
(2) No person, firm, association, or corporation shall act in the capacity of an MGA representing an insurer domiciled in this state with respect to risks located outside this state unless such person is licensed as a producer in this state (such license may be a nonresident license) pursuant to the provisions of this part 10.
(3) The commissioner may require a bond in an amount acceptable to the commissioner for the protection of the insurer.
(4) The commissioner may require the MGA to maintain an errors and omissions policy.
C.R.S. § 10-2-1004 Required contract provisions
10-2-1004. Required contract provisions. (1) No person, firm, association, or corporation acting in the capacity of an 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, which specifies the division of such responsibilities, and which contains the following minimum provisions:
(a) 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.
(b) The MGA shall 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.
(c) All funds collected for the insurer's account shall 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 months' estimated claims payments and allocated loss adjustment expenses.
(d) Separate records of business written by the MGA shall 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 commissioner shall have access to all books, bank accounts, and records of the MGA in a form usable to the commissioner. Such records shall be retained for a period of five years commencing no later than the effective date of the last financial examination of the insurer.
(e) The contract may not be assigned in whole or part by the MGA.
(f) (I) Appropriate underwriting guidelines which shall include:
(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.
(II) The insurer shall have the right to cancel or nonrenew any policy of insurance subject to the applicable laws and regulations concerning the cancellation and nonrenewal of insurance policies.
(g) (I) If the contract permits the MGA to settle claims on behalf of the insurer, all claims shall be reported to the company in a timely manner.
(II) A copy of the claim file shall be sent to the insurer at its request or as soon as it becomes known that the claim:
(A) Has the potential to exceed an amount determined by the commissioner or exceeds the limit set by the company, whichever is less;
(B) Involves a coverage dispute;
(C) May exceed the MGA's claims settlement authority;
(D) Is open for more than six months; or
(E) Is closed by payment of an amount set by the commissioner or an amount set by the company, whichever is less.
(III) All claim files shall be the joint property of the insurer and the MGA; however, upon an order of liquidation of the insurer, such files shall become the sole property of the insurer or its estate. The MGA shall have reasonable access to and the right to copy the files on a timely basis.
(IV) 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.
(h) Where electronic claims files are in existence, the contract must address the timely transmission of the data;
(IV) 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.
(h) Where electronic claims files are in existence, the contract must address the timely transmission of the data;
(i) 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 shall not be paid to the MGA until one year after they are earned for property insurance business and five years after they are earned on casualty business and not until the profits have been verified pursuant to section 10-2-1005.
(2) 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 which such automatic agreements are in effect, the coverages and amounts or 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 such producer 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 of the insurer's policyholder's surplus as of December 31 of the last completed calendar year;
(e) Collect any payment from a reinsurer or commit the insurer to any claim settlement with a reinsurer, without prior approval of the insurer. If prior approval is given, a report shall be promptly forwarded to the insurer.
(f) Permit its subproducer to serve on the insurer's board of directors;
(g) Jointly employ an individual who is employed with the insurer;
(h) Appoint a sub-MGA.
C.R.S. § 10-2-1005 Duties of insurers
10-2-1005. Duties of insurers. (1) The insurer shall have on file an independent financial examination, in a form acceptable to the commissioner, of each MGA with which it has done business.
(2) If an 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 periodically and at least semiannually conduct an on-site review of the underwriting and claims processing operations of the MGA.
(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 days of entering into or termination of a contract with an MGA, the insurer shall provide written notification of such appointment or termination to the commissioner. Notices of appointment of an MGA shall include a statement of duties which the applicant is expected to perform on behalf of the insurer, the lines of insurance for which the applicant is to be authorized to act, and any other information the commissioner may request.
(6) An insurer shall review its books and records each quarter to determine if any producer has become an MGA as defined in section 10-2-1002 (2). If the insurer determines that a producer has become an MGA pursuant to section 10-2-1002 (2), the insurer shall promptly notify the producer and the commissioner of such determination and the insurer and producer shall fully comply with the provisions of this part 10 within thirty days.
(7) An insurer shall not appoint to its board of directors an officer, director, employee, subproducer, or controlling shareholder of its MGA's. This subsection (7) shall not apply to relationships governed by part 8 of article 3 of this title.
C.R.S. § 10-2-1006 Examination authority
10-2-1006. Examination authority. The acts of the MGA are considered to be the acts of the insurer on whose behalf the MGA is acting. An MGA may be examined as if said MGA were the insurer.
C.R.S. § 10-2-1007 Penalties and liabilities
10-2-1007. Penalties and liabilities. (1) If the commissioner finds, after a hearing conducted in accordance with article 4 of title 24, C.R.S., that any person has violated any provision of this part 10, the commissioner may order:
(a) For each separate violation, a penalty in an amount not to exceed five thousand dollars;
(b) Revocation or suspension of the producer'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 this part 10 committed by the MGA.
(2) The decision, determination, or order of the commissioner pursuant to subsection (1) of this section shall be subject to judicial review by the court of appeals pursuant to section 24-4-106 (11), C.R.S.
(3) Nothing contained in this section shall affect the right of the commissioner to impose any other penalties provided for in this title.
(4) Nothing contained in this part 10 is intended to or shall in any manner limit or restrict the rights of policyholders, claimants, and auditors.
C.R.S. § 10-2-1008 Rules and regulations
10-2-1008. Rules and regulations. The commissioner may adopt reasonable rules and regulations for the implementation and administration of the provisions of this part 10.
C.R.S. § 10-2-1101 Effective date - applicability
10-2-1101. Effective date - applicability. This article shall take effect January 1, 1995. Insurance agent and broker licenses issued pursuant to part 2 of this article prior to said date shall expire at such time as the commissioner shall determine by rule promulgated under the authority of this article. The holders of such licenses may obtain comparable licenses under this article by complying with the rules promulgated by the commissioner under the authority of this article.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://leg.colorado.gov/sites/default/files/images/olls/crs2024-title-10.docxFetched: 10/6/2026