Title 31 — Subtitle 03. Insurance Producers and Other Insurance Professionals
Chapter 01. Temporary Licensees
Regulation .01 Individual Business Continuation Cases.LinkCopy Citation
A.
If a qualified and licensed resident insurance producer should die, become mentally or physically disabled, or enter upon active service in the armed forces of the United States of America, the Insurance Commissioner will give consideration to the issuance of temporary licenses to an individual who comes under one of the categories listed in Insurance Article, §10-120(a), Annotated Code of Maryland. Except in unusual circumstances, consideration will not be given to any nonresident applicant.
B.
The grant of authority given to an approved applicant will be restricted to the same kinds of insurance only for which the insurance producer whom the applicant is replacing was qualified and licensed.
C.
Any renewal application for a temporary license shall be stamped received in the Insurance Administration in advance of the expiration of the existing temporary license.
D.
If the insurance business of the original insurance producer is sold, transferred, or otherwise disposed of, any temporary license to continue that business shall be terminated and the licensee shall return the license or licenses to the Insurance Administration for cancellation. Further licenses will not be issued in that case.
Regulation .02 Repealed.LinkCopy Citation
Regulation .03 Revocation of Temporary Licenses.LinkCopy Citation
A temporary license which has been issued under the provisions of the Insurance Article and this chapter may be revoked in accordance with provisions of the Insurance Article, §10-126, Annotated Code of Maryland.
Regulation .04 Issuance of Temporary License.LinkCopy Citation
A temporary license for a life or health insurance producer may not be issued to any applicant affiliated or to be affiliated with an appointing insurer if to do so would increase the appointing insurer's proportion of resident insurance producers temporarily licensed to resident insurance producers permanently licensed to 10 percent or more, based upon statistics for the previous calendar year.
Regulation .05 Issuance of Appointments.LinkCopy Citation
A.
An insurer may not issue an appointment to act as a temporary life or health insurance producer if to do so would increase the proportion of resident insurance producers temporarily licensed by the insurer to resident insurance producers permanently licensed to 10 percent or more, based upon statistics for the previous calendar year.
B.
The Insurance Commissioner may, at the discretion of the Insurance Commissioner, allow an insurer to exceed the 10 percent limitation stated in §A of this regulation if the Insurance Commissioner reasonably believes that the limitation would impose an undue burden on the conduct of the insurer's business in Maryland.
C.
In determining whether to allow an insurer to exceed the 10 percent limitation stated in §A of this regulation, the Insurance Commissioner shall consider the total number of resident insurance producers appointed by the insurer and the length of time the insurer has been doing business in Maryland.
Chapter 02. Insurance Producers — Continuing Education Requirements
Regulation .01 Scope.LinkCopy Citation
A.
This chapter applies to an individual licensed resident or nonresident insurance producer who seeks to renew a license under Insurance Article, Annotated Code of Maryland, but does not apply to an individual holding the type of license described in Insurance Article, §10-116(b), Annotated Code of Maryland.
B.
The following types of courses are not considered to be continuing education courses and are outside the scope of this chapter:
(1)
A course that is designed for preparing an applicant for the examination given to obtain an initial license as an insurance producer; and
(2)
A course designed to prepare a person for an examination in a kind or subdivision of insurance that the insurance producer seeks to add to the insurance producer's existing license.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Advisory board” means a group of individuals appointed by the Insurance Commissioner pursuant to Insurance Article, §10-110, Annotated Code of Maryland, to review continuing education courses for insurance producers and to make recommendations regarding the courses.
(2)
“Bail bondsman services” means any conduct relating to the sale, solicitation, negotiation, or procurement of a bail bond, and includes the posting of a bail bond.
(3)
“Commissioner" means the Insurance Commissioner of Maryland.
(4)
“Course” means a presentation of information delivered in person, in print, electronically, or via teleconference, the successful completion of which is measured by verifiable attendance or by examination, or both.
(5)
“Course completion date” means the date when a student has submitted all necessary information to the education provider and, when applicable, successfully met the course attendance requirements or passed the final examination, or both.
(6)
“Course completion roster” means a listing of candidates who have completed a continuing education course, provided in a format determined by the Commissioner, which includes the following:
(a)
The course name, the designated course number, and the course completion date;
(b)
The provider’s identification number;
(c)
The instructor’s license number, if applicable; and
(d)
For each student who completes the course:
(i)
The student’s name;
(ii)
The student’s national producer number or the student’s license number, or both; and
(iii)
The number of hours of continuing education earned by the student.
(7)
“Course coordinator” means an individual who is responsible for organizing a continuing education course, getting it approved by the Insurance Commissioner, and supervising the administration of the course after its approval.
(8)
“Expiration date” means the date the license expires as stated on the license.
(9)
“Hour of continuing education” means 50 minutes of work in a course that has been approved by the Commissioner to receive continuing education credit.
(10)
“Instructor” means a subject matter expert, approved by the Commissioner, presenting course activities or information in a course approved by the Commissioner.
(11)
“License” has the meaning stated in Insurance Article, §10-101(d), Annotated Code of Maryland.
(12)
“Licensed insurance producer” has the meaning stated in Insurance Article, §1-101(w), Annotated Code of Maryland.
(13)
“National examination” means an examination given as part of a nationally recognized designation awarded by a national insurance organization, including the:
(a)
Life Underwriter Training Council (LUTC) course curricula;
(b)
American College diploma curriculum for Chartered Life Underwriter (CLU), Chartered Financial Consultant (ChFC), Certified Employee Benefits Specialist (CEBS) or Registered Health Underwriter (RHU);
(c)
College of Financial Planning diploma curriculum for Chartered Financial Planning (CFP) program;
(d)
Insurance Institute of America curriculum for:
(i)
Program in General Insurance (INS);
(ii)
Associate in Claims Program (AIC);
(iii)
Associate in Risk Management Program (ARM);
(iv)
Associate in Underwriting Program (AIU);
(v)
Associate in Loss Control Management Program (ALCM);
(vi)
Accredited Advisor in Insurance Program (AAI);
(vii)
Associate Premium Auditing Program (APA); and
(viii)
Associate in Research and Planning Program (ARP);
(e)
American Institute for Property and Liability Underwriters Chartered Property and Casualty Underwriter (CPCU) program;
(f)
Health Insurance Association of America Program (HIAA);
(g)
Academy of Life Underwriting Education Council curriculum for LUEC program; or
(h)
Certified Insurance Counselor program (CIC).
(14)
“Preneed insurance contract” has the meaning stated in COMAR 31.05.03.03B.
(15)
“Provider” means an entity that has been approved by the Commissioner to offer continuing education courses to licensed insurance producers in the State.
(16)
“Renewal period” means the period from the issuance or renewal of a license until the day before the expiration date of the license.
(17)
“Renewal year” means the 12-month period from January 1 until December 31 in which a license renewal occurs.
(18)
“Self-study course” means a course that is not presented in a classroom, is not delivered in person, and does not require interaction with an instructor.
(19)
“Successfully complete” means to complete and meet all requirements of an approved course for which a valid certificate of course completion has been issued.
(20)
“Teleconference” means the live exchange of information among several persons who are separately located but linked by audio or video, or both, that provides for opportunities for interactions between student and instructor.
(21)
“Viatical settlement broker” has the meaning stated in Insurance Article, §8-601(k), Annotated Code of Maryland.
Regulation .03 General Continuing Education Requirements.LinkCopy Citation
A.
Except as set forth in this regulation, in order to renew a license, a licensed insurance producer shall successfully complete in each renewal period at least 24 hours of continuing education.
B.
A licensed insurance producer who, as of October 1, 2008, has held a license for 25 or more consecutive years shall successfully complete 8 hours of continuing education in each renewal period in order to renew the license.
C.
A licensed insurance producer shall obtain at least 3 hours of continuing education in Ethics.
D.
A licensed insurance producer shall obtain hours of continuing education in the kind or subdivision of insurance for which they hold a license, as follows:
(1)
Except for the required hours of continuing education in Ethics, if the licensed insurance producer has only a license for property insurance, casualty insurance, or any of the subdivisions of property or casualty insurance, the licensed insurance producer shall obtain all necessary hours of continuing education in courses designated by the Commissioner as “Property/Casualty” or “PC”;
(2)
Except for the required hours of continuing education in Ethics, if the licensed insurance producer has only a license for life insurance, health insurance, or any of the subdivisions of life or health insurance, the licensed insurance producer shall obtain all necessary hours of continuing education in courses designated by the Commissioner as “Life/Health” or “LH”;
(3)
If the licensed insurance producer has a license for property or casualty, or any subdivision of property or casualty, and life or health, or any subdivision of life or health, then the licensed insurance producer shall complete:
(a)
24 hours of continuing education with a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty” and a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”; or
(b)
For licensed insurance producers who meet the requirements of §B of this regulation,8 hours of continuing education with a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty” and a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”;
(4)
In addition to the required hours of continuing education in Ethics, if the licensed insurance producer holds a title insurance producer license only, the licensed insurance producer shall obtain 13 hours of continuing education in one or more courses designated by the Commissioner as “Title” in each renewal period in order to renew the license;
(5)
If the licensed insurance producer has a license for title and property or casualty, or any subdivision of property or casualty, then the licensed insurance producer shall complete:
(a)
24 hours of continuing education with a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Title” and a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty”; or
(b)
For licensed insurance producers who meet the requirements of §B of this regulation, 8 hours of continuing education with a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Title” and a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty”;
(6)
If the licensed insurance producer has a license for title and life or health, or any subdivision of life or health, then the licensed insurance producer shall complete:
(a)
24 hours of continuing education with a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Title” and a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”; or
(b)
For licensed insurance producers who meet the requirements of §B of this regulation, 8 hours of continuing education with a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Title” and a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”;
(7)
If the licensed insurance producer has a license for title, property, or casualty, or any subdivision of property or casualty, and life or health, or any subdivision of life or health, then the licensed insurance producers shall complete:
(a)
24 hours of continuing education with a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Title”, a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty”, and a minimum of 6 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”; or
(b)
For licensed insurance producers who meet the requirements of §B of this regulation, 8 hours of continuing education with a minimum of 1 hour of continuing education in a course designated by the Commissioner as “Title”, a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Property/Casualty”, and a minimum of 2 hours of continuing education in one or more courses designated by the Commissioner as “Life/Health”; or
(8)
A licensed insurance producer who has only a license for life insurance and also is a licensed funeral director or a licensed mortician and sells only life insurance policies or annuity contracts that fund preneed insurance contracts and is not a viatical settlement broker shall complete at least 16 hours of continuing education courses designated by the Commissioner as “Life/Health” in each renewal period in order to renew the license.
E.
Sales of Long-Term Care Insurance.
(1)
A licensed insurance producer with authority to sell health insurance who also sells long-term care insurance shall obtain at least 2 hours of continuing education in a course designated “Long Term Care” or “LH-LTC” in order to renew the license.
(2)
These hours of continuing education may be considered a part of the required hours of continuing education under §A or B of this regulation.
F.
A licensed insurance producer who possesses a license to sell property and casualty insurance and who sells flood insurance, homeowners insurance, or commercial property insurance shall obtain at least 2 hours of continuing education that directly relates to flood insurance as part of the required hours of continuing education.
G.
A licensed insurance producer who possesses a license to sell property and casualty insurance and provides bail bondsman services shall obtain at least 4 hours of continuing education that directly relates to bail bond insurance.
H.
Hours of Continuing Education — Passing Scores.
(1)
A licensee who receives a passing score on a national examination and has been awarded a nationally recognized designation as listed in Regulation .02B(13)of this chapter may request that the Commissioner apply towards the requirement stated in §D of this regulation:
(a)
Up to 24 hours of continuing education credits approved by the Commissioner towards the hours of continuing education required for the next renewal period; and
(b)
Up to 9 hours of any remaining continuing education hours approved by the Commissioner for the renewal period immediately thereafter.
(2)
The licensee shall submit to the Administration the examination results issued by the nationally recognized designation organization that clearly identifies the national designation name, the licensee name, and the date the examination was passed with the renewal application.
(3)
The hours of continuing education granted from earning the following designations shall be applied as Life/Health course credits to the continuing education requirement of licensees who hold the Life and/or Health lines of authority:
(a)
Life Underwrite Training Council (LUTC);
(b)
American College diploma curriculum for Chartered Life Underwriter (CLU);
(c)
Chartered Financial Consultant (ChFC);
(d)
Certified Employee Benefits Specialist (CEBS);
(e)
Registered Health Underwriter (RHU);
(f)
College of Financial Planning diploma curriculum for Chartered Financial Planning (CFP);
(g)
Health Insurance Association of America Program (HIAA); or
(h)
Academy of Life Underwriting Education Council curriculum for LUEC program.
(4)
The hours of continuing education granted from earning the following designations shall be applied as Property/Casualty course credits to the continuing education requirement of licensees who hold the Property and/or Casualty lines of authority:
(a)
Associate in Risk Management Program (ARM);
(b)
Accredited Advisor in Insurance Program (AAI); or
(c)
American Institute for Property and Liability Underwriters Chartered Property and Casualty Underwriter (CPCU).
(5)
The hours of continuing education granted from the following designations shall be applied as Life/Health/Property/Casualty course credits to the continuing education requirement of licensees who hold the Life, Health, Property and/or Casualty lines of authority:
(a)
Program in General Insurance (INS);
(b)
Associate in Claims Program (AIC);
(c)
Associate in Underwriting Program (AIU);
(d)
Associate Premium Auditing Program (APA);
(e)
Associate in Research and Planning Program (ARP); or
(f)
Certified Insurance Counselor Program (CIC).
(6)
A licensee may not apply any hours of continuing education granted by the Commissioner pursuant to this section towards the 3 hours of continuing education in Ethics requirement.
(7)
Hours of continuing education received for a passing score on a national examination are in addition to any hours of continuing education received for completing a course that is required in order to take the national examination and that has been approved by the Commissioner under this chapter.
I.
A course instructor shall earn 1-1/2 hours of continuing education for each approved hour of instruction of an approved course.
J.
A licensed insurance producer or a course instructor may not earn hours of continuing education:
(1)
For attending or instructing a subsequent offering of the same course in the same renewal period; or
(2)
If the same course was taken in two different renewal periods but within 6 months.
Regulation .04 Holders of Expired Licenses Who Seek Reinstatement.LinkCopy Citation
A.
The holder of an expired license who seeks reinstatement of the license under Insurance Article, §10-116.1, Annotated Code of Maryland, shall fulfill the continuing education requirements for the renewal period that concluded on the day before the immediately preceding expiration date of the licensed insurance producer’s license in order to qualify for reinstatement.
B.
A licensed insurance producer who does not have sufficient hours of continuing education on the day before the most recent expiration date of the license will have all hours of continuing education earned on or after the expiration date credited toward the requirement for the renewal period that concluded on the day before the license expired.
Regulation .05 Nonresident Licensed Insurance Producers.LinkCopy Citation
A.
A nonresident licensed insurance producer whose state of residence has a continuing education requirement shall fulfill all of the requirements of the state of residence, and the continuing education requirements of Maryland may not be applicable to the licensed insurance producer.
B.
A nonresident licensed insurance producer whose state of residence does not have a continuing education requirement shall fulfill Maryland continuing education requirements, which may be fulfilled entirely through correspondence courses.
Regulation .06 Licensed Insurance Producer Responsibilities.LinkCopy Citation
A.
A licensed insurance producer shall:
(1)
Maintain a record of the certificate of course completion received for 4 years following the date that the course was completed; and
(2)
Upon request, submit with the renewal application each certificate of course completion needed to fulfill the licensed insurance producer’s hours of continuing education for the renewal period.
B.
Under Insurance Article, §10-126, Annotated Code of Maryland, the Commissioner may suspend or revoke a license if a licensed insurance producer is found to have knowingly:
(1)
Falsified a certificate of course completion; or
(2)
Submitted a falsified certificate of course completion.
Regulation .07 Approval of Courses.LinkCopy Citation
A.
A continuing education course shall be submitted to the Commissioner for approval. The Commissioner may approve a course only if the course imparts substantive and procedural knowledge relating to the insurance field.
B.
The Commissioner may not approve a course covering any of the following subject areas:
(1)
A course in office or business skills, including typing, speed reading, or the use of computers, calculators, or other machines or equipment;
(2)
A course in office management, client relations, or other matters aimed at improving the operation of the person's business; or
(3)
A course in salesmanship or product promotion, stress management, time management, psychology, motivation, or written or oral communications.
C.
Except for a self-study course, a course submitted to the Commissioner for approval does not need to require a textbook or an examination in order to receive approval.
D.
The Commissioner shall assign to each approved course:
(1)
The number of hours of continuing education that an individual taking the course may receive for successful completion of the course;
(2)
A designated course number that is provided on all certificates of course completion, all correspondence relating to the course, and on all forms filed with the Commissioner relating to the course;
(3)
A designation of “Property/Casualty”, “Life/Health”, “Long Term Care”, or “Ethics”; and
(4)
A course expiration date.
Regulation .08 Submission of Courses for Approval.LinkCopy Citation
A.
A provider shall submit to the Commissioner:
(1)
A fully completed course approval package consisting of the following forms provided by the Commissioner;
(a)
Request for approval of continuing education course,
(b)
Course coordinator information,
(c)
Course instructor information and approval form,
(d)
Certificate of course completion, and
(e)
Checklist of items that must accompany the course approval package;
(2)
A statement of the educational objectives;
(3)
A full and detailed description of the course content including the amount of time allotted to each subject covered by the course on an hour-by-hour basis;
(4)
All course materials, including textbooks, written materials in place of textbooks, course syllabus, policy forms, and any other items used by the instructor;
(5)
Promotional materials; and
(6)
A statement of the refund policy, which shall include:
(a)
Full refund of course fees due to cancellation by the sponsor; and
(b)
The refund policy when the licensed insurance producer:
(i)
Withdraws from the course before commencement, and
(ii)
Fails to complete the course after it has commenced; and
(7)
If the Commissioner contracts with a vendor to review continuing education courses, the fee charged by the vendor.
B.
The provider shall submit a course approval package to the Commissioner as follows:
(1)
A course previously approved in another state or jurisdiction that has adopted the “NAIC Uniform Declaration Regarding Continuing Education Reciprocity Course Approval Guidelines” shall be submitted using the NAIC Uniform Continuing Education Reciprocity Course Filing Form at least 30 days before the first date on which the course is to be taught; or
(2)
A course that has not been previously approved in a state that has adopted the “NAIC Uniform Declaration Regarding Continuing Education Reciprocity Course Approval Guidelines” shall be submitted at least 45 days before the first date on which the course is to be taught.
C.
The Commissioner shall notify the provider in writing of a course approval and the period of time of the approval, which shall be from the date of the approval until the second anniversary of the date the course was approved.
D.
A provider may offer only a course approved by the Commissioner.
Regulation .09 Submission of Courses for Renewal.LinkCopy Citation
A.
At least 90 days prior to the expiration of a course’s approval, the Commissioner shall mail to the provider of the approved course a notice that states:
(1)
The course name, the course content code, the course number, and the date on which the course approval expires;
(2)
The date by which the Commissioner must receive the request to renew; and
(3)
The fee charged for reviewing continuing education courses submitted for renewal.
B.
In order to renew a course, a provider must comply with the provisions of COMAR 31.03.02.08.
Regulation .10 Providers.LinkCopy Citation
A.
A provider shall:
(1)
Comply with this chapter for each of the provider’s approved courses;
(2)
Use in all communication with the Commissioner or the Commissioner’s designee the provider identification number assigned by the Commissioner;
(3)
Use a course coordinator who meets the qualifications specified in this chapter;
(4)
Use an approved instructor; and
(5)
Notify the Commissioner of the replacement of a course coordinator.
B.
A provider who is an insurer authorized to do business in Maryland may not require an appointed insurance producers to obtain hours of continuing education by attending an approved course that the insurer is providing.
C.
Within 10 days of the completion of a course, the provider shall report a course completion roster to the Commissioner or the Commissioner’s designee in an electronic format specified by the Commissioner.
Regulation .11 Course Coordinators.LinkCopy Citation
A.
The provider shall ensure that each approved continuing education course has at least one course coordinator who is responsible for:
(1)
Supervising the administration of the course; and
(2)
Compliance with this chapter.
B.
A course coordinator shall possess one or more of the following qualifications:
(1)
A minimum of 5 years experience as an actively licensed insurance producer;
(2)
A minimum of 3 years experience as an administrator of an education program;
(3)
A degree in education and at least 2 years experience as a licensed insurance producer; or
(4)
Full-time employment in the insurance education field as a coordinator with at least 6 months experience.
C.
A course coordinator shall:
(1)
Assure compliance with this chapter;
(2)
Notify the Commissioner of:
(a)
Any change in the instructor for an approved course;
(b)
The date, time, and location of a course offering and the name of the instructor not less than 14 calendar days in advance of the date that the course offering is scheduled to begin; and
(c)
The cancellation of a course offering as soon as reasonably possible;
(3)
Assure that students are provided with current and accurate information;
(4)
Create an accurate record of student attendance and successful course completion for each offering of an approved course;
(5)
Supervise and evaluate courses and instructors;
(6)
Investigate complaints relating to course offerings and instructors;
(7)
Maintain accurate records relating to course offerings, instructors, student attendance, and student course completion for a minimum of 4 years following the date of the course offering; and
(8)
Within 15 days of the student’s completion of the course, provide each student with a certificate of course completion on a form approved by the Commissioner.
Regulation .12 Instructors.LinkCopy Citation
A.
The provider shall ensure that each continuing education course approved by the Commissioner is taught by an instructor who has been approved by the Commissioner as meeting the qualifications specified in this chapter.
B.
The provider shall submit to the Commissioner a course instructor information and approval form for each instructor of an approved course.
C.
An instructor shall possess one or more of the following qualifications:
(1)
A minimum of 2 years experience in the subject matter being taught;
(2)
A degree in the subject matter being taught; or
(3)
A minimum of 2 years recent experience as a licensed insurance producer and a minimum of 6 months practical experience in the subject matter being taught.
D.
The Commissioner may not approve as an instructor a licensed insurance producer:
(1)
Who has been fined; or
(2)
Whose license has been suspended or revoked.
E.
An instructor shall:
(1)
Comply with this chapter;
(2)
Provide students with:
(a)
Current and accurate information on the subject matter of the course; and
(b)
A course syllabus that shall contain at least the following information:
(i)
Course title and designated course number assigned by the Commissioner;
(ii)
Times and dates of the course offering;
(iii)
Names, addresses, and telephone numbers of each course coordinator; and
(iv)
Detailed outline of the subject matter of the course.
F.
The Commissioner may revoke the approval of any course that is not taught by an approved instructor.
Regulation .13 Advertising of Approved Courses.LinkCopy Citation
A.
Except as provided in §D of this regulation, a provider may not advertise or distribute promotional materials unless the course has been approved by the Commissioner.
B.
Advertisements and promotional materials may not be deceptive or misleading and shall, at a minimum, clearly identify the number of hours of continuing education for which a course has been approved and the fee for taking the course.
C.
A provider of an approved course who advertises or promotes a course that has not been approved or a course that is not eligible for approval shall prominently state that no hours of continuing education can be earned by taking the course.
D.
A provider may request, in writing, permission to advertise a course before approval is obtained from the Commissioner by submitting:
(1)
A letter specifically requesting permission to advertise the course before approval is obtained; and
(2)
With the course approval package, all advertisements or promotional materials that will be used before approval and which shall prominently include the words “approval from the Insurance Administration pending”.
E.
The Commissioner shall issue the provider a written response either granting or denying the provider’s request. The provider may not advertise the course until the Commissioner has granted the request.
Regulation .14 Prohibited Practices.LinkCopy Citation
The following practices by a provider, course coordinator, or instructor are prohibited:
A.
Offering or teaching a course that is not approved or that is not in substantial conformity with the course completion package submitted to and approved by the Commissioner;
B.
Promoting a particular insurance agency or insurance company or products of the agency or company; and
C.
Requiring, as a condition of receiving a certificate of course completion, that students participate in other programs or services offered by the provider, course coordinator, or instructor.
Regulation .15 Powers of the Commissioner.LinkCopy Citation
A.
The Commissioner, the Commissioner’s designee, or the members of an advisory board may audit all course offerings with or without notice to the provider, course coordinator, or instructor of the course.
B.
The Commissioner may suspend or revoke the approval of a course for any of the following violations of this chapter:
(1)
Failure of the instructor to follow the approved course content;
(2)
Failure to use a course coordinator meeting the qualifications specified in this chapter;
(3)
Failure to use an approved instructor;
(4)
Failure to notify the Commissioner of the date, time, location, and instructor of a course offering in accordance with Regulation .11C(2)(b) of this chapter; or
(5)
Failure to report a course completion roster in accordance with Regulation .10C of this chapter.
C.
The Commissioner may suspend or revoke all approved courses of a particular provider for a violation of this chapter or refuse to approve a course submitted by a specific provider if the Commissioner determines that a past course offering by that provider was not in compliance with this chapter.
D.
The Commissioner may suspend or revoke the approval of any instructor, course coordinator, or course provider who fails to comply with this chapter.
Regulation .16 Waiver of the Continuing Education Requirement.LinkCopy Citation
A.
Subject to §B of this regulation, the continuing education requirements may be waived for a licensed insurance producer who:
(1)
Submits a written request for a waiver; and
(2)
Is determined by the Commissioner, in the Commissioner's discretion, to warrant the waiver.
B.
A waiver request shall be accompanied by supporting documentation.
Regulation .17 Advisory Boards.LinkCopy Citation
The Commissioner may appoint a life and health advisory board and a property and casualty advisory board as provided by Insurance Article, §10-110(b) and (c), Annotated Code of Maryland, for the purpose of reviewing the course approval packages submitted to the Commissioner and making recommendations on approval or disapproval of courses.
Chapter 03. Fiduciary Responsibility of Insurance Producers: Premium Accounts — Commingling of Funds
Regulation .01 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Carrier” means a person that is:
(a)
An insurer that holds a certificate of authority in the State and provides insurance in the State;
(b)
A health maintenance organization that is licensed to operate in the State;
(c)
A nonprofit health service plan that is licensed to operate in the State; or
(d)
Any other person or organization that provides insurance or health benefit plans subject to State insurance regulation.
(2)
“Operating account” means an account owned by an insurance producer containing monies that are utilized primarily for the day to day operation of the insurance producer’s business.
(3)
“Personal account” means an account owned by an individual who is an insurance producer containing monies that are utilized primarily for the individual’s personal expenses.
(4)
“Premium” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
(5)
“Premium account” means an account in a bank or banks authorized to do business in this State or subject to jurisdiction of this State containing premium monies or voluntary deposits, from which withdrawals may not be made except as specified in COMAR 31.03.03.02C.
(6)
“Prompt remittance” means remittance of premium monies to carriers or insureds not later than the close of the fifth business day following receipt of the funds.
(7)
“Voluntary deposit” means a deposit into a premium account in excess of aggregate net premiums, return premiums, and deposits received but not remitted, made for the purpose of maintaining a minimum balance, to guarantee the adequacy of the account, or to pay premium due but uncollected.
Regulation .02 General Requirements.LinkCopy Citation
A.
Premium Account. An insurance producer that does not make prompt remittance of a carrier or insured’s premium shall maintain such premium in one or more premium accounts, which shall be separate from any operating accounts or personal accounts.
B.
Commingling of Premium.
(1)
An insurance producer acting as such in this State may not commingle any premium account with any operating account or personal account.
(2)
An insurance producer acting as such in this State may:
(a)
Make voluntary deposits into the insurance producer’s premium account.
(b)
Unless prohibited by the carrier, or by Regulation .04 of this chapter, commingle a single carrier’s premium with the premium of one or more other carriers into one or more premium accounts.
C.
Withdrawals.
(1)
Withdrawals from a premium account may not be made other than for the following purposes:
(a)
Payment of premiums to carriers.
(b)
Transfer to an operating account of bank interest, if the carrier has consented to it in writing.
(c)
Transfer to an operating account of commissions either actual or average. If average commissions are used, the insurance producer shall maintain on file in the insurance producer's office at all times a letter from each carrier stating the percentage of the average commission.
(d)
Withdrawal of voluntary deposits.
(e)
Payment of return deposits to insureds.
(f)
Payment of return premiums to insureds in the ordinary course of business when a written agreement with the carrier authorizing this practice exists.
(2)
A withdrawal may not be made if the balance remaining in the premium account thereafter is less than aggregate net premiums, return premiums, and deposits received but not remitted.
D.
Deposit of a premium in a premium account may not be construed as a commingling of the net premium and of the commission portion of the premium.
Regulation .03 Account Current System.LinkCopy Citation
In the case of an insurance producer operating under an account current system, maintenance at all times in one or more premium accounts of at least the net balance of premiums as determined by either actual or average commissions, return premiums, and deposits received but not remitted, shall be construed as compliance with this chapter, provided that the funds so held for each carrier are readily ascertainable from the insurance producer's records.
Regulation .04 Substantial Interest.LinkCopy Citation
In those instances when the officers, directors, or principal management of a carrier have a substantial interest in either the conduct or operation of the agency or brokerage business, or when the officers, directors, or principal management of an agency or brokerage business have a substantial interest in the conduct or operation of the carrier, the agency or brokerage business shall maintain one or more premium accounts to be used exclusively for any premium collected from the carrier, which shall be separate from premium accounts for other carriers.
Chapter 04. Regulation Restricting Licensed Insurance Producers to Placing Maryland Risks for State Citizens with Authorized Insurers
Regulation .01 Unfair Trade Practice.LinkCopy Citation
A.
This regulation does not apply to:
(1)
Reinsurance of the liability of an admitted insurer;
(2)
Insurance against perils of navigation, transit, or transportation upon hulls, freights or disbursements, or other personal property and interest therein, in the course of exportation from or importation into any country, or transportation coastwise, including transportation by land or water from point of origin to final destination and including war risks; and marine builder's risks, dry docks, and marine railways, including insurance of ship repairer's liability, and protection and indemnity insurance, but excluding insurance covering:
(a)
Bridges and tunnels,
(b)
Pleasure craft that are under 60 feet in length and are owned and used for pleasure and not for business, hire, or other commercial use,
(c)
Fishing vessels under 50 gross tons weight that are not part of a fleet of three or more vessels, or
(d)
Charter or head boats under 50 gross tons that are not part of a fleet of three or more vessels;
(3)
Aircraft insurance;
(4)
Insurance on property or operations of railroads engaged in interstate commerce;
(5)
Insurance effectuated in accordance with the Surplus-Line Insurance Law, Insurance Article, Title 3, Subtitle 3, Annotated Code of Maryland; and
(6)
Insurance effectuated in accordance with Article 83A, §§5-1035 and 5-1037, Annotated Code of Maryland, and State Finance and Procurement Article, §§13-207, 13-208, 13-216, and 17-104, Annotated Code of Maryland.
B.
It is deemed to be an unfair trade practice in the business of insurance for any insurance producer licensed both in Maryland and in another state or the District of Columbia to place insurance on risks located in Maryland for Maryland citizens with insurers not authorized to do business in this State.
Chapter 05. Bail Bonds
Regulation .01 Scope.LinkCopy Citation
A.
This chapter does not apply to property bail bondsmen.
B.
Except as provided in Insurance Article, §10-309, Annotated Code of Maryland, this chapter does not apply to a bail bondsman who provides bail bondsman services under Criminal Procedure Article, §5-203, Annotated Code of Maryland.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Affidavit” means a dated written or printed statement of facts, made voluntarily, and confirmed by oath or affirmation of the person making it, taken before an individual having authority to administer such oath or affirmation in connection with posting a bail bond pursuant to Maryland Rule 4-217.
(2)
“Appointment” has the meaning set forth in Insurance Article, §1-101, Annotated Code of Maryland.
(3)
“Authorized insurer” has the meaning set forth in Insurance Article, §1-101, Annotated Code of Maryland.
(4)
“Bail bond” has the meaning set forth in Insurance Article, §10-301, Annotated Code of Maryland.
(5)
“Bail bond application” means a written request to a surety insurer for a bail bond that sets forth the required information to purchase a policy of surety insurance.
(6)
“Bail bondsman” means a surety insurance producer who is appointed by a surety insurer to solicit, negotiate, or procure bail bonds on behalf of that surety insurer.
(7)
“Bail bondsman services” means any conduct relating to the sale, solicitation, negotiation, or procurement of a bail bond, and includes the posting of a bail bond.
(8)
“Balance amount” means the amount of premium owed by a person under an installment agreement after subtracting the down payment from the premium.
(9)
“Commissioner” means the Maryland Insurance Commissioner.
(10)
“Indemnity agreement” means a written surety agreement that is entered into by a bail bondsman and a person who agrees to indemnify a bail bondsman or surety insurer.
(11)
“Installment agreement” means a written agreement between a bail bondsman and a person in which the person agrees to pay, and the bail bondsman agrees to accept, the payment of a premium for a bail bond using installment payments.
(12)
“Insurance producer” has the meaning set forth in Insurance Article, §1-101, Annotated Code of Maryland.
(13)
“Licensed insurance producer” has the meaning set forth in Insurance Article, §1-101, Annotated Code of Maryland.
(14)
“Property bail bondsman” has the meaning set forth in Criminal Procedure Article, §5-209, Annotated Code of Maryland.
(15)
“Surety insurance” has the meaning set forth in Insurance Article, §1-101, Annotated Code of Maryland.
(16)
“Surety insurance producer” means a licensed insurance producer who, for compensation, sells, solicits, negotiates, or procures surety insurance contracts and is appointed by an authorized surety insurer to act as an insurance producer.
(17)
“Surety insurer” has the meaning set forth in Insurance Article, §10-301, Annotated Code of Maryland.
Regulation .03 Prohibited Actions.LinkCopy Citation
A.
An insurer may not:
(1)
Directly or indirectly pay any commission, fee, reward, or other consideration for the sale, solicitation, negotiation, or procurement, or for influencing the sale, solicitation, negotiation, or procurement of, a bail bond to any person unless that person is a bail bondsman, and is appointed by the surety insurer; or
(2)
Delegate its authority to appoint a bail bondsman.
B.
A person acting as a bail bondsman or a person acting on behalf of a bail bondsman may not in any manner sell, solicit, negotiate, or procure a bail bond for a surety insurer in this State unless that person is a bail bondsman and is appointed by the surety insurer.
C.
A bail bondsman may not submit to any clerk, District Court commissioner, or other person authorized by law to take a bail bond, a document representing consent by any person unless the document has been fully executed.
Regulation .04 Conduct of Business by a Bail Bondsman.LinkCopy Citation
The business of a bail bondsman may be conducted by an individual, partnership, or corporation, provided that an individual who sells, solicits, negotiates, or procures bail bonds shall be a bail bondsman.
Regulation .05 Appointments.LinkCopy Citation
A.
A bail bondsman shall:
(1)
Before conducting business as a bail bondsman, be appointed by a surety insurer to provide bail bondsman services; and
(2)
Comply with the requirements of Maryland Rule 4-217.
B.
A surety insurer that terminates the appointment of a bail bondsman shall immediately file a written notice of the termination with the Commissioner and with the Chief Clerk of the District Court of Maryland.
Regulation .06 Suspension or Revocation.LinkCopy Citation
A bail bondsman who makes a misleading or false representation to a court or to a public official for the purpose of avoiding a forfeiture of bail, having a forfeiture set aside, or obtaining the release of a defendant on the defendant’s own recognizance, shall be in violation of Insurance Article, §10-126(a)(6), (13), and (14), Annotated Code of Maryland.
Regulation .07 Rates.LinkCopy Citation
A.
A bail bondsman shall issue a bail bond that complies with Insurance Article, §27-216, Annotated Code of Maryland.
B.
Except as provided in §C of this regulation, it shall be an unfair trade practice and a violation of the Insurance Article, §27-216, Annotated Code of Maryland, for a bail bondsman to sell, solicit, procure, or negotiate a bail bond if:
(1)
A surety insurer has an approved premium rate for both cash bail bonds and corporate surety bail bonds;
(2)
The premium rates differ for cash bail bonds and corporate surety bail bonds; and
(3)
A defendant is sold a bail bond with the higher premium rate.
C.
If a surety insurer has approved premium rates for cash bail bonds and corporate surety bail bonds, a bail bondsman may sell a defendant a bail bond regardless of the approved premium rate if the court specifies a type of bail bond.
Regulation .08 Indemnity Agreement.LinkCopy Citation
An indemnity agreement shall:
A.
Contain the signatures of the bail bondsman providing the bail bondsman services and the person signing the indemnity agreement;
B.
Be executed prior to the issuance of a bail bond;
C.
Contain the printed name and insurance producer license number of the bail bondsman providing the bail bondsman services;
D.
Require the person signing the indemnity agreement to pay, and the bail bondsman to collect, the premium for the bail bond that is issued:
(1)
At the time the indemnity agreement for the bail bond is executed by the bail bondsman and the person signing the indemnity agreement; or
(2)
Through installment payments pursuant to a written installment agreement that complies with the requirements set forth in Regulation .09 of this chapter; and
E.
Contain the following statement on the first page in capital and bold letters of at least 12-point font: “THE PERSON SIGNING THIS INDEMNITY AGREEMENT IS ENTITLED TO A REFUND OF 100% OF THE PREMIUM PAID IF THIS BAIL BOND IS NOT POSTED.”
Regulation .09 Installment Agreement.LinkCopy Citation
A.
An installment agreement shall be signed by a bail bondsman and the person who has agreed to pay the additional premium in installments.
B.
The installment agreement shall be written in the form adopted under Regulation .15 of this chapter and shall contain the following information:
(1)
The amount of the bail bond;
(2)
The amount of the premium;
(3)
The amount of the down payment;
(4)
The amount of the balance owed;
(5)
The total number of installment payments required to pay the balance;
(6)
The amount and due date of each installment payment;
(7)
The printed name and insurance producer license number of the bail bondsman executing the installment agreement;
(8)
The printed name of the bail bond insurance producer firm and its insurance producer license number, if the bail bondsman is employed or otherwise engaged by a bail bond insurance producer firm; and
(9)
The criminal case number for which bail was posted and the installment agreement entered.
C.
The bail bondsman who signed the installment agreement shall maintain records demonstrating that the bail bondsman has taken all necessary steps to collect the amount owed.
D.
Evidence that a bail bondsman has taken all necessary steps to collect the amount owed under the installment agreement may include, but is not limited to:
(1)
Copies of all correspondence;
(2)
Meeting logs, including the date and time the bail bondsman met with the person who signed the installment agreement;
(3)
Telephone logs including the date, time, and name of the person with whom the bail bondsman communicated;
(4)
Evidence that the debt has been referred to a collection agency, including the date of the referral and the name of the collection agency; and
(5)
A copy of a civil court action seeking the money owed by the person who signed the installment agreement to the bail bondsman, including the filing of a writ of garnishment.
E.
A bail bondsman shall provide the person signing the installment agreement a copy of the installment agreement and a receipt containing the amount of down payment made.
Regulation .10 Records.LinkCopy Citation
A.
A bail bondsman shall maintain for a period of 5 years after termination of the surety liability all documentation collected, prepared, and produced by the bail bondsman in the course of providing bail bondsman services, which shall include, but is not limited to, the following:
(1)
Evidence of the return of any security or collateral, including a receipt evidencing the return or repayment of the security or collateral;
(2)
Copies of the affidavit made in connection with posting a bond or an indemnity agreement or collateral received; and
(3)
Copies of all written representations made to any court or to any public official for the purpose of avoiding a forfeiture of bail, setting aside a forfeiture of bail, or causing a defendant to be released on the defendant’s own recognizance.
B.
In addition to the records set forth in §A of this regulation, a bail bondsman’s records shall include the following information:
(1)
A copy of the power of attorney form;
(2)
The date the bond was executed;
(3)
The name of the person who signed the indemnity agreement;
(4)
The amount of the bond;
(5)
The premium charged;
(6)
The premium reported to the surety insurer and the date reported;
(7)
A description, including the date and amount, of any collateral received;
(8)
A description, including the date and amount, of any collateral returned;
(9)
The indemnity agreement;
(10)
The disposition of the bond, including the date of disposition;
(11)
A copy of any receipt for payment made to obtain an indemnity agreement or for an installment agreement;
(12)
The bail bond application;
(13)
A copy of the bail bond;
(14)
The installment agreement, if any; and
(15)
The information required under Regulation .09D of this chapter.
C.
Records required by this regulation shall be maintained in writing or by electronic means, provided that the records:
(1)
Are clear and legible;
(2)
Accurately reproduce an original document in its entirety, including any attachments to the document; and
(3)
Preserve any signature contained on the document.
D.
The certification required pursuant to Insurance Article, §10-309(e)(3), Annotated Code of Maryland, shall be submitted by December 31 on a form made available by the Commissioner.
Regulation .11 Premium Receipts.LinkCopy Citation
A.
A bail bondsman who collects a premium shall provide a numbered receipt to the person paying the premium. A copy of the receipt shall be retained by the bail bondsman and maintained in accordance with Regulation .10 of this chapter.
B.
A receipt shall contain the following information:
(1)
The name, place of business, address, and telephone number of the bail bondsman who collected the premium;
(2)
An itemized statement of the amount of bail and the jurisdiction for which the bond is being written;
(3)
An itemized statement of the premium charged;
(4)
The amount collected by the surety insurance producer;
(5)
The unpaid balance, if any;
(6)
The amount, value, and description of any collateral received;
(7)
The following statement, in capital and bold letters of at least 12-point font, at the bottom of the receipt: THE PERSON PAYING THE PREMIUM MUST RECEIVE A COPY OF THIS RECEIPT AT THE TIME OF MAKING A PAYMENT; and
(8)
The insurance producer license number and the printed and signed name of the bail bondsman collecting the premium.
Regulation .12 Forms.LinkCopy Citation
A bail bondsman shall:
A.
Ensure that each document provided to, or executed by, the person signing the indemnity agreement contains the name and insurance producer license number of the bail bondsman providing the bail bondsman services and the bail bond insurance producer firm, if any; and
B.
Provide the person to whom the bail bondsman services are provided with a copy of:
(1)
A premium receipt at the time the premium is paid;
(2)
A collateral receipt at the time the collateral is given; and
(3)
An installment agreement or indemnity agreement at the time that any such document is signed.
Regulation .13 Collateral.LinkCopy Citation
A.
A bail bondsman shall, in an affidavit, describe in detail any collateral received in connection with the sale of a bail bond and the terms of an indemnity or collateral agreement; and
B.
A bail bondsman shall provide a copy of the affidavit to the person signing the indemnity agreement or the person signing the collateral agreement.
Regulation .14 Return of Collateral.LinkCopy Citation
A.
Immediately upon the discharge of a bail bond, the bail bondsman shall return any collateral held by the bail bondsman. Upon receiving a request for return of collateral, the bail bondsman shall promptly determine whether the bail bond has been discharged.
B.
The bail bondsman may deduct any unpaid premiums due on the bail bond from any collateral being returned.
Regulation .15 Installment Agreement Form.LinkCopy Citation
FORM AT END OF CHAPTER
Chapter 06. Surplus Lines
Regulation .01 Purpose.LinkCopy Citation
The purpose of this chapter is to establish procedures for compliance with the Surplus Line Insurance Law, Insurance Article, Title 3, Subtitle 3, Annotated Code of Maryland.
Regulation .01-1 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Condominium” includes the common elements of a condominium.
(2)
Home State.
(a)
“Home State” means, except as provided in §B(2)(b) of this regulation, with respect to an insured:
(i)
The state in which an insured maintains its principal place of business or, in the case of any individual, the individual’s principal residence; or
(ii)
If 100 percent of the insured risk is located out of the state referred to in §B(2)(a)(i) if this regulation, the state to which the greatest percentage of the insured’s taxable premium for that insurance contract is allocated.
(b)
If more than 1 insured from an affiliated group are named insureds on a single nonadmitted insurance contract, the term “Home State” means the Home State, as determined pursuant to §B(2)(a) of this regulation, of the member of the affiliated group that has the largest percentage of premium attributed to it under such insurance contract.
(3)
“Qualified risk manager” means, with respect to a policyholder of commercial insurance, a person who meets all of the following requirements:
(a)
The person is an employee of, or third-party consultant retained by, the commercial policyholder;
(b)
The person provides skilled services in loss prevention, loss reduction, or risk and insurance coverage analysis, and purchase of insurance; and
(c)
The person meets at least one of the following criteria:
(i)
The person has a bachelor’s degree or higher from an accredited college or university in risk management, business administration, finance, economics, or any other field determined by the Commissioner to demonstrate minimum competence in risk management and has 3 years of experience in risk financing, claims administration, loss prevention, risk and insurance analysis, or purchasing commercial lines of insurance;
(ii)
The person has a bachelor’s degree or higher from an accredited college or university in risk management, business administration, finance, economics, or any other field determined by the Commissioner to demonstrate minimum competence in risk management, and holds:
1.
A designation as a Chartered Property and Casualty Underwriter (in this subparagraph referred to as “CPCU”) issued by the American Institute for CPCU/Insurance Institute of America;
2.
A designation as an Associate in Risk Management (ARM) issued by the American Institute for CPCU/Insurance Institute of America;
3.
A designation as a Certified Risk Manager (CRM) issued by the National Alliance for Insurance Education and Research;
4.
A designation as a RIMS Fellow (RF) issued by the Global Risk Management Institute; or
5.
Any other designation, certification, or license determined by the Commissioner to demonstrate minimum competency in risk management;
(iii)
The person has at least 7 years of experience in risk financing, claims administration, loss prevention, risk and insurance coverage analysis, or purchasing commercial lines of insurance, and has any one of the designations specified in §B(3)(c)(ii)1—5 of this regulation;
(iv)
The person has at least 10 years of experience in risk financing, claims administration, loss prevention, risk and insurance coverage analysis, or purchasing commercial lines of insurance; or
(v)
The person has a graduate degree from an accredited college or university in risk management, business administration, finance, economics, or any other field determined by the Commissioner to demonstrate minimum competence in risk management.
(4)
Residential Property.
(a)
“Residential property” means a home, townhouse, or other habitable structure that is used principally as a residence.
(b)
“Residential property” does not include:
(i)
A vacant structure;
(ii)
A structure with both commercial and residential use if more than 50 percent of the structure is devoted to commercial use;
(iii)
An apartment building that contains more than four apartment units; or
(iv)
A condominium.
Regulation .02 Maryland Surplus Lines Brokers' Licenses.LinkCopy Citation
Before placing any surplus line or otherwise acting as a surplus lines broker, where Maryland is the Home State of the insured, it will be the responsibility of each individual so acting to acquire a valid Maryland surplus lines broker’s certificate of qualification. The broker will be held responsible for securing timely renewals of the broker’s certification of qualification in order to place new business and provide a continuity of service to clients for whom the broker has previously acted. Each original surplus lines broker’s certificate of qualification shall be issued for a term expiring every other year on the date stated on the certificate of qualification and may be renewed biennially thereafter.
Regulation .03 Surplus Lines Affidavits.LinkCopy Citation
A surplus lines broker placing a surplus lines coverage shall execute the affidavit required by Insurance Article, §3-307, Annotated Code of Maryland, on a form provided by the Commissioner, or containing all of the information required by the Commissioner, and shall file the affidavit with the Commissioner on or before the 45th day after the last day of the quarter in which the insurance was placed.
Regulation .04 Residential Property — Substantially Similar Renewal Offer.LinkCopy Citation
A.
Presumption. For purposes of Insurance Article, §3-306(a)(5)(iii), Annotated Code of Maryland, a renewal offer by an authorized insurer for coverage on residential property is presumed to be made on substantially the same terms and conditions as the current coverage unless the renewal offer:
(1)
Contains an increase in premium of 20 percent or more;
(2)
Contains an increase in the deductible of 100 percent or more; or
(3)
Contains or omits any other term or condition that the Commissioner has determined in writing to result in the terms and conditions of the renewal offer not being substantially similar to the terms and conditions of the current coverage.
B.
Request for Determination.
(1)
Upon written request from the originating insurance producer or a surplus lines broker, the Commissioner shall provide a written determination of whether the terms and conditions of a renewal offer are substantially similar to the current coverage which will be expiring.
(2)
The request shall provide, at a minimum, the following information:
(a)
A description of the insured risk and the type of coverage provided;
(b)
A policy number for the expiring coverage and the date that the coverage expires;
(c)
A full explanation of the terms and conditions which differ between the renewal offer and the current coverage;
(d)
Copies of the relevant policies or specific policy terms, if needed to fully explain the differences;
(e)
The name, address, phone number, and electronic mail address for the individual who can respond to any questions from the Commissioner's staff; and
(f)
The name and address of the individual who is to receive the Commissioner's written determination.
C.
Documentation. Whenever coverage provided by an authorized insurer on residential property is replaced with coverage provided by an unauthorized insurer, the surplus lines broker or the originating insurance producer shall state in the affidavit required by Insurance Article, §3-307, Annotated Code of Maryland, or on a form approved by the Commissioner and submitted with the affidavit:
(1)
Whether the authorized insurer made a renewal offer; and
(2)
If the authorized insurer did make a renewal offer, the reason why the terms and conditions of the renewal offer were not substantially similar to the terms and conditions of the coverage previously provided.
Regulation .05 Surplus Lines Reports and Premium Receipts Tax.LinkCopy Citation
A.
Each surplus lines broker that has transacted surplus lines business in the State during the preceding half calendar year shall file with the Commissioner a semiannual statement that reports on business subject to the tax imposed by Insurance Article, §3-324, Annotated Code of Maryland, during the preceding half calendar year. The report shall be made in accordance with the form prescribed by the Commissioner and available from the Commissioner’s office.
B.
The broker shall deliver the report to the office of the Commissioner on or before March 15 and September 15 of each year.
C.
The March 15 report shall cover the business placed between July 1 and December 31, inclusive, of the preceding calendar year. The September report shall cover the business placed between January 1 and June 30, inclusive, of the calendar year in which the report is made.
D.
The reports shall be open to public inspection and shall include:
(1)
The gross amount of each kind of insurance business transacted and the aggregate gross premiums charged;
(2)
The aggregate of returned premiums and taxes paid to insureds;
(3)
The aggregate of net premiums; and
(4)
Any additional information required by the form.
E.
All premiums and taxes, including additional and return premiums and taxes, may be reported and paid on a placed or written basis but shall be paid in any case for the full term of the policy, whether or not one or more installments of premium remain unearned and payable at some future date or dates during the term of policy. In computing the tax due, the broker may deduct the expense of any examination made in accordance with Insurance Article, §§2-208 and 3-325(d), Annotated Code of Maryland, during the period covered by the report.
Regulation .06 Compliance with Filing and Premium Receipts Tax Payment Requirements.LinkCopy Citation
A.
A report, affidavit, or return that must be filed under this chapter complies with the filing requirement if the report, affidavit, or return is:
(1)
Mailed or postmarked by the United States Postal Service on or before the filing date;
(2)
Delivered on or before the filing date to a private delivery service recognized by the Commissioner, if the delivery is evidenced by a receipt; or
(3)
Transmitted electronically on or before the filing date in a manner approved by the Commissioner.
B.
Each broker shall remit the full amount of the premium receipts tax appearing on the report filed pursuant to Regulation .05 of this chapter at the time the report is filed.
C.
Each broker shall remit the full amount of the premium receipts tax in the manner directed by the Commissioner on the form prescribed by the Commissioner pursuant to Regulation .05 of this chapter.
D.
With respect to premium receipts tax due to the State, a surplus lines broker who fails to pay a tax when a report under Regulation .05 of this chapter is due, or fails to file a report, is subject to the provisions of Insurance Article, Title 6, Subtitle 1, Annotated Code of Maryland related to penalties, audits, assessments, limitations, appeals, and refunds.
Regulation .07 Books and Records.LinkCopy Citation
A.
Every surplus lines broker shall keep a separate record and account of all business transacted under the surplus lines broker's license, including a copy of each daily report, if any, and of each binder or cover note delivered by the surplus lines broker. The records shall be available for examination by the Commissioner at any reasonable time within 3 years after the issuance of the coverage to which the records relate.
B.
Every surplus lines broker shall maintain an adequate record of all return or additional premiums resulting from cancellations, adjustments made on deposit or minimum premiums, audit premiums, additional or return premiums as a result of endorsement to existing policies, additional or return premiums resulting from changes in the amount or type of coverage, and other changes resulting from any other cause.
Regulation .08 Illegal Coverage.LinkCopy Citation
A surplus lines broker may not place with an unauthorized insurer any risk, whether individual or group, including any fictitious fleet or fictitious group, which is not eligible for placement with authorized insurers under the provisions of the Insurance Article, Annotated Code of Maryland.
Regulation .09 Disclosure Form.LinkCopy Citation
A.
Printing Specifications; Provision of Form to Insured. The written disclosure required by Insurance Article, §3-308, Annotated Code of Maryland, shall be:
(1)
In the form set forth in §B of this regulation in at least 14-point type;
(2)
On a separate piece of paper that:
(a)
Contains only the disclosure; and
(b)
Is attached to the insurance contract or binder; and
(3)
Provided to the insured at the time of the initial purchase or delivery of an insurance contract or binder from a surplus lines insurer and at each renewal of the insurance contract.
B.
Form.
C.
In addition to the disclosure required by §B of this regulation, the surplus lines broker shall:
(1)
Provide a clear and conspicuous written disclosure to the prospective insured of:
(a)
Any inspection fee;
(b)
The total amount of the policy fee;
(c)
The premium tax on the policy;
(d)
Any financial interest of the person performing the inspection, if applicable;
(e)
Whether the surplus lines broker will receive compensation from the person that performs the inspection; and
(f)
Any charge for actual expenses incurred by the surplus lines broker for payment of the premium, policy fee, and any other fees and taxes relating to the policy by use of a credit card; and
(2)
Notify the prospective insured of the option to obtain the inspection from another person who meets the requirements of or is approved by the surplus lines broker.
D.
Signature of Insured on Disclosure Form for Policies Covering Residential Property or a Condominium.
(1)
This section applies only to the written disclosure form for an insurance policy covering residential property or a condominium.
(2)
In addition to the text required by §B of this regulation, the disclosure form for an insurance policy covering residential property or a condominium shall include blanks for the insured's signature, the insured's printed name, and the execution date.
(3)
Whenever residential property or condominium insurance is placed or renewed with a surplus lines insurer, the originating insurance producer shall obtain the signature of the insured, the insured's printed name, and the execution date on the disclosure form.
(4)
On execution, the originating insurance producer shall:
(a)
Send the original copy of the disclosure form to the surplus lines broker;
(b)
Provide a copy of the disclosure form to the insured; and
(c)
Keep a copy of the disclosure form in the files of the originating insurance producer for at least 3 years after the date of execution by the insured.
(5)
The surplus lines broker shall:
(a)
Retain the original copy of the disclosure form for at least 3 years after the date of execution by the insured; and
(b)
Make the disclosure form available for inspection by the Commissioner on request.
E.
Disclosure Form Requirements for Policies Not Covering Residential Property or a Condominium.
(1)
This section applies only to a written disclosure form for an insurance policy that does not cover residential property or a condominium.
(2)
The surplus lines broker or the originating insurance producer shall provide the insured with the written disclosure required by §B of this regulation in the manner specified by §A of this regulation.
(3)
The surplus lines broker or the originating insurance producer shall:
(a)
Certify on a form approved by the Commissioner that the disclosure notice required by this regulation has been delivered to the insured with the insurance policy or binder; or
(b)
Obtain from the insured written acknowledgment of receipt of the disclosure form.
(4)
If the surplus lines broker or the originating insurance producer obtains written acknowledgement of receipt of the disclosure form, the surplus lines broker or the originating insurance producer shall:
(a)
Retain for at least 3 years a copy of the written acknowledgment of receipt from the insured; and
(b)
Make the acknowledgment available for inspection by the Commissioner on request.
Regulation .10 Surplus Lines Exportable List.LinkCopy Citation
A.
Diligent Search Not Required. In accordance with Insurance Article, §3-306.1(b)(1), Annotated Code of Maryland, a coverage that is listed in §C of this regulation may be placed with a surplus lines insurer without first conducting a diligent search as defined by Insurance Article, §3-306.1(a), Annotated Code of Maryland.
B.
Affidavit Required. When a coverage that is listed in §C of this regulation is placed with a surplus lines insurer, the originating insurance producer shall execute and file an affidavit in accordance with Insurance Article, §3-307, Annotated Code of Maryland, and Regulation .03 of this chapter.
C.
The surplus lines exportable list is as follows:
(1)
Amusement devices;
(2)
Animal mortality;
(3)
Armored cars;
(4)
Auto racing and auto race tracks;
(5)
Aviation—crop dusters;
(6)
Billiard halls;
(7)
Bowling alleys—property damage only;
(8)
Builders risk—all risks form (non-Bureau form);
(9)
Building demolition—including use of explosives;
(10)
Carnivals and circuses;
(11)
Child and adult care centers, convalescent homes, or community residence facilities;
(12)
Difference in condition—parasol;
(13)
Directors' and officers' liability for the following:
(a)
Coverages:
(i)
Employment practices liability;
(ii)
Entity liability coverage;
(iii)
Non-monetary damages;
(iv)
Liability for prior acts; or
(v)
Fiduciary liability; or
(b)
Classes:
(i)
Entities involved in initial public offerings of securities;
(ii)
Nonprofit organizations with negative fund balances;
(iii)
Entities in business for less than 3 years; or
(iv)
Financially distressed risks, including risks in pending or threatened bankruptcy, risks operating under Chapter 11 of the Bankruptcy Code, or risks unable to meet their financial obligations out of current assets;
(14)
Employment practices liability for the following coverages:
(a)
Family Medical Leave Act liability;
(b)
False imprisonment;
(c)
Intentional infliction of emotional distress;
(d)
Interference with contractual relations;
(e)
Negligent supervision or hiring;
(f)
Damages for breach of express contract;
(g)
Mergers;
(h)
Prior acts;
(i)
Punitive or liquidated damages; or
(j)
Prior knowledge;
(15)
Environmental impairment liability;
(16)
Excess automobile and motorcycle;
(17)
Exercise and health clubs;
(18)
Excess liability;
(19)
Exterminators;
(20)
False arrest liability;
(21)
Fire and general liability on buildings occupied as auction markets or farmers' markets;
(22)
Fire and general liability on buildings occupied as bars, restaurants, or night clubs, with or without entertainment;
(23)
Fireworks displays;
(24)
Flood and water damage — excess of federal flood insurance programs or primary coverage that is at least as broad as the coverage available through the federal flood insurance program;
(25)
Golf driving ranges;
(26)
Holdup, theft, and robbery coverages for:
(a)
Automated teller machines;
(b)
Check cashing businesses;
(c)
Electronics stores;
(d)
Taverns;
(e)
Package stores;
(f)
Carnivals;
(g)
Fairs; and
(h)
Exhibitions;
(27)
House movers and house wreckers;
(28)
Libel and slander;
(29)
Liquor liability;
(30)
Non-appearance, event cancellation, or weather insurance;
(31)
Physical damage:
(a)
Automobile physical damage for antique vehicles, high-value vehicles, kits, replicas, and custom-made vehicles; or
(b)
Vehicle physical damage for vehicles with a gross vehicle weight classified by the Insurance Services Office (ISO) as medium or heavier;
(32)
Pollutants—first and/or third-party coverages for existence or removal, or both, of a broad range of contaminants or pollutants;
(33)
Prize indemnification;
(34)
Professional liability—miscellaneous errors and omissions, except for those professions and occupations available in the admitted market, including architects, engineers, physicians, lawyers, travel agents, real estate brokers, and insurance producers;
(35)
Riding academies and pony rides (on location or away from premises);
(36)
Risks in bankruptcy;
(37)
Securities Exchange Act liability;
(38)
Short-term events;
(39)
Short-term homeshare business multi-peril;
(40)
Skating rinks—roller and ice;
(41)
Space satellites or craft;
(42)
Sporting events;
(43)
Stop loss and excess aggregate over self-insured retention (S.I.R.)—all lines not excluded pursuant to Insurance Article, §3-302, Annotated Code of Maryland;
(44)
Substandard fire risks not eligible for Fair Plan;
(45)
Swimming clubs, water skiing clubs, and swimming pools;
(46)
Tanning beds or salons;
(47)
Tattoo parlors;
(48)
Umbrella liability:
(a)
With no self-insured retention;
(b)
With defense costs outside policy limits; or
(c)
Written by the same non-admitted insurer that provides underlying liability insurance;
(49)
Vacant or unoccupied buildings; and
(50)
Warehousepersons' legal liability.
Regulation .11 Exempt Commercial Purchaser — Waiver of Diligent Search Requirement.LinkCopy Citation
A.
Scope. This regulation does not apply to:
(1)
Professional liability insurance;
(2)
Title insurance; or
(3)
Workers' compensation insurance.
B.
In this regulation, “Exempt Commercial Purchaser” means any person purchasing commercial insurance that, at the time of placement, meets the following requirements:
(1)
The person employs or retains a qualified risk manager to negotiate insurance coverage;
(2)
The person has paid aggregate nationwide commercial property and casualty insurance premiums in excess of $100,000 in the immediately preceding 12 months; and
(3)
The person meets at least 1 of the following criteria:
(a)
The person possesses a net worth in excess of $20,000,000, as such amount is adjusted pursuant to §C of this regulation;
(b)
The person generates annual revenues in excess of $50,000,000, as such amount is adjusted pursuant to §C of this regulation;
(c)
The person employs more than 500 full-time or full-time equivalent employees per individual insured or is a member of an affiliated group employing more than 1,000 employees in the aggregate;
(d)
The person is a not-for-profit organization or public entity generating annual budgeted expenditures of at least $30,000,000, as such amount is adjusted pursuant to §C of this regulation; or
(e)
The person is a municipality with a population in excess of 50,000 persons.
C.
Effective on the fifth January 1 occurring after July 21, 2011, and each fifth January 1 occurring thereafter, the amounts in §B(3)(a), (b), and (d) of this regulation shall be adjusted to reflect the percentage change for the 5-year period in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics of the Department of Labor.
D.
Waiver of Diligent Search Requirement.
(1)
An Exempt Commercial Purchaser may waive the diligent search requirement of Insurance Article, §3-306, Annotated Code of Maryland, for the procurement of a surplus lines insurance policy if:
(a)
The surplus lines broker has disclosed to the Exempt Commercial Purchaser that the insurance may or may not be available from admitted insurers that may be subject to greater protection and regulatory oversight; and
(b)
The Exempt Commercial Purchaser subsequently has requested the surplus lines broker in writing to procure nonadmitted insurance from or place the nonadmitted insurance with a nonadmitted insurer.
(2)
The surplus lines broker shall:
(a)
Retain for at least 3 years a copy of the written request document signed by the Exempt Commercial Purchaser; and
(b)
Make the written request document available for inspection by the Commissioner on request.
E.
Procurement That Is Not Authorized By Regulation. This regulation does not authorize an Exempt Commercial Purchaser to procure surplus lines insurance:
(1)
Solely to obtain a lower premium rate than would be accepted by an authorized insurer;
(2)
Solely to obtain more favorable terms of the insurance contract; or
(3)
To replace coverage on residential property that is insured by an authorized insurer and for which a renewal offer has been made on substantially the same terms and conditions as the current coverage.
F.
Premium Tax. This regulation does not exempt an Exempt Commercial Purchaser from payment of the premium tax on surplus lines insurance pursuant to Insurance Article, §3-324, Annotated Code of Maryland.
Chapter 07. Installment Vendors Doing Business In Maryland (Such as Auto Dealers, Boat Dealers, Appliance Dealers, Loan Companies)
Regulation .01 Violations.LinkCopy Citation
It has come to the attention of the Insurance Administration that installment vendors may be selling insurance in conjunction with their retail installment sales without proper insurance producers' licenses. These sales or service of insurance are violations of the Insurance Article, Annotated Code of Maryland, and this chapter.
Regulation .02 Requirements.LinkCopy Citation
Installment vendors shall comply with the requirements of Insurance Article, §§1-201, 10-103, 10-130, and 10-131, Annotated Code of Maryland.
Regulation .03 Employees To Read this Chapter.LinkCopy Citation
Installment vendors should make certain that this chapter of regulations is read by all their employees that may be affected by it.
Chapter 08. Licensing Services — Designation of Contractor — Payment for Services
Repealed
Chapter 09. Staggered System for Renewal of Licenses
Regulation .01 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Administration” means the Maryland Insurance Administration.
(2)
“License” has the meaning stated in Insurance Article, §10-101(d), Annotated Code of Maryland.
Regulation .02 Establishment of Staggered System of Renewals.LinkCopy Citation
A.
In General. The Administration may establish a staggered system of renewal for licenses.
B.
Uniform Distribution of Renewal Dates.
(1)
The Administration shall establish staggered renewal dates for licenses so that approximately the same number of licenses are renewed each day.
(2)
From time to time, the Administration shall evaluate the monthly volume of license renewals for the purpose of maintaining relatively uniform workloads.
(3)
The Administration may adjust the monthly volumes of license renewals by:
(a)
Changing the month of expiration of a license;
(b)
Prorating the renewal fee for the license and the fraud prevention fee in accordance with Regulation .04 of this chapter; and
(c)
Prorating the continuing education hours for renewal of the license in accordance with Regulation .05 of this chapter.
Regulation .03 Term and Renewal of Licenses.LinkCopy Citation
A.
Term. The term of a license is 2 years from the date of issuance.
B.
Renewal. The Administration shall renew licenses for a term of 2 years from the date of renewal unless the Administration changes the expiration date under Regulation .02B(3) of this chapter.
Regulation .04 Proration of Fees.LinkCopy Citation
A.
Renewal Fees. If the Administration is required to charge a prorated renewal fee for a license, the Administration shall calculate the amount of the prorated fee by:
(1)
Dividing the appropriate renewal fee listed in Insurance Article, §2-112, Annotated Code of Maryland, by 24;
(2)
Multiplying the quotient obtained under §A(1) of this regulation by the number of months for which the license is issued or renewed; and
(3)
Rounding the product obtained under §A(2) of this regulation to the nearest dollar, with amounts ranging from 1 cent to 50 cents rounded down to the next lower dollar and amounts ranging from 51 cents to 99 cents rounded up to the next higher dollar.
B.
Fraud Prevention Fee. If the Administration is required to charge a prorated fraud prevention fee, the Administration shall calculate the amount of the prorated fee by:
(1)
Dividing the fraud prevention fee listed in Insurance Article, §6-203, Annotated Code of Maryland, by 24;
(2)
Multiplying the quotient obtained under §B(1) of this regulation by the number of months for which the license is issued or renewed; and
(3)
Rounding the product obtained under §B(2) of this regulation to the nearest dollar, with amounts ranging from 1 cent to 50 cents rounded down to the next lower dollar and amounts ranging from 51 cents to 99 cents rounded up to the next higher dollar.
Regulation .05 Proration of Continuing Education Credit Hours.LinkCopy Citation
A.
General Continuing Education Requirements. Except as otherwise provided by Insurance Article, §10-116, Annotated Code of Maryland, the holder of a license shall complete 16 credit hours of continuing education before the holder may renew the license.
B.
Proration.
(1)
The holder of a license whose date of expiration is changed by the Administration pursuant to Regulation .02B(3)(a) of this chapter, who has held a license for fewer than 25 consecutive years, shall successfully complete the following number of credit hours of continuing education before the holder may renew the license and receive a license with a 2-year term:
(a)
For a license changed to a term of 1 year to 1 1/2 years, 8 credit hours;
(b)
For a license changed to a term of more than 1 1/2 years but not more than 2 years, 12 credit hours;
(c)
For a license changed to a term of more than 2 years but not more than 2 1/2 years, 16 credit hours; or
(d)
For a license changed to a term of more than 2 1/2 years but not more than 3 years, 20 credit hours.
(2)
The holder of a license whose date of expiration is changed by the administration pursuant to Regulation .02B(3)(a) of this chapter, who has held a license for 25 or more consecutive years, beginning on the date of expiration, and counting back to the year that the license was first obtained, shall successfully complete 50 percent of the credit hours of continuing education required in §B(1) of this regulation before the holder may renew the license and receive a license with a 2-year term.
(3)
If the holder of a license whose date of expiration is changed has a license for both property or casualty, or any subdivision of property or casualty, and life or health, or any subdivision of life or health, in order to renew the license, the holder of the license shall successfully complete a minimum of:
(a)
25 percent of the required credit hours in one or more courses designated “Property/Casualty”; and
(b)
25 percent of the required credit hours in one or more courses designated “Life/Health”.
(4)
National Examination.
(a)
If the holder of a license whose date of expiration is changed receives a passing score on a national examination on or before the day before the expiration date of the license, the holder of the license shall receive the number of continuing education credit hours that the Commissioner has approved for the examination towards the credit hours needed to renew the license.
(b)
If the holder of a license whose date of expiration is changed receives a passing score on a national examination on or after the expiration date of the license, the holder of the license shall receive the number of continuing education credit hours that the Commissioner has approved for the examination towards the next license renewal.
Chapter 10. Advisers
Regulation .01 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Adviser” has the meaning stated in Insurance Article, §10-201(b), Annotated Code of Maryland.
(2)
“Licensed insurance producer” has the meaning stated in Insurance Article, §1-101(w), Annotated Code of Maryland.
Regulation .02 Representation by Member of Trade Association.LinkCopy Citation
A.
In General. A person is not required to be licensed as an adviser under Insurance Article, §10-203, Annotated Code of Maryland, in order to represent to the public that the person is a member of a trade association or similar organization that uses the term “insurance adviser” or a similar term in the name of the association or organization if the person:
(1)
Is a member in good standing of the trade association or similar organization at the time that the person makes the representation;
(2)
Does not otherwise act as an adviser or represent that the person is an adviser; and
(3)
Makes the representation in accordance with the requirements of §B of this regulation.
B.
Manner of Representation. A person who otherwise qualifies to make a representation under §A of this regulation may make the representation only if the person:
(1)
Expressly qualifies the representation by use of a disclaimer such as “not a licensed insurance adviser” or, if the person is a licensed insurance producer, “licensed insurance producer only”; or
(2)
Makes the representation:
(a)
During a meeting of the trade association or similar organization held for the purpose of conducting the association's or organization's general business activities;
(b)
In a newspaper, newsletter, e-mail, or similar publication or electronic communication that is intended to be distributed only to members of the trade association or similar organization;
(c)
While soliciting a person to become a member of the trade association or similar organization; or
(d)
During an approved continuing education class for licensed insurance producers.
C.
Manner of Disclaimer. A person who is required to make a disclaimer under §B(1) of this regulation shall make the disclaimer:
(1)
At the same time and in the same medium as the representation; and
(2)
If the representation is made in writing, on the same document or screen close to the representation.
Chapter 11. Motor Vehicle Rental Companies—Limited Lines License
Regulation .01 Scope.LinkCopy Citation
This chapter applies to motor vehicle rental companies that sell or offer any insurance coverage in this State to a motor vehicle renter in connection with, and incidental to, a motor vehicle rental agreement.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Franchisee” means a person to whom a franchise has been granted by a motor vehicle rental company under Business Regulation Article, Title 14, Subtitle 2, Annotated Code of Maryland.
(2)
“Limited lines license” means a limited lines license to sell insurance in connection with, and incidental to, the rental of a vehicle.
(3)
Motor Vehicle Rental Company.
(a)
“Motor vehicle rental company” means a person that is in the business of providing motor vehicles to the public under a rental agreement for a period of 180 days or less.
(b)
“Motor vehicle rental company” includes a franchisee or subsidiary that is in the business of providing motor vehicles to the public under a rental agreement for a period of 180 days or less.
(4)
“Rental agreement” means a written agreement containing the terms and conditions that govern the use of a vehicle provided by a motor vehicle rental company under the provisions of Transportation Article, Title 18, Annotated Code of Maryland.
(5)
“Renter” means a person obtaining the use of a vehicle from a motor vehicle rental company under the terms of a rental agreement.
(6)
“Subsidiary” means a business entity that is directly or indirectly controlled by a motor vehicle rental company.
(7)
“Vehicle” means a motor vehicle of the:
(a)
Private passenger type, including passenger vans, minivans, and sport utility vehicles; or
(b)
Cargo type, including cargo vans, pickup trucks, and trucks that do not require the operator to possess a commercial driver's license.
Regulation .03 Limited Lines License and Appointment Required.LinkCopy Citation
Before a motor vehicle rental company or an employee of a motor vehicle rental company sells or offers any policies of insurance in this State to a renter in connection with, and incidental to, a rental agreement, the motor vehicle rental company shall:
A.
Hold a limited lines license issued by the Commissioner; and
B.
Have on file with the Commissioner an appointment from each authorized insurer that the motor vehicle rental company intends to represent.
Regulation .04 Application for Limited Lines License.LinkCopy Citation
An applicant for a limited lines license shall:
A.
Submit an application to the Commissioner on the form approved by the Commissioner;
B.
Pay to the Commissioner the applicable fee required under Insurance Article, §2-212, Annotated Code of Maryland, for an insurance producer license;
C.
Submit with the application a disclosure as set out in Regulation .06 of this chapter, including any brochures or other written material;
D.
Submit with the application the filing required by Regulation .07C of this chapter that describes the training program that a motor vehicle rental company must have approved by the Commissioner;
E.
If applicable, submit a written agreement signed by an officer of each insurer represented by the motor vehicle rental company that the premiums collected from a renter for the insurance do not need to be segregated from other funds collected by the motor vehicle rental company in connection with the vehicle rental; and
F.
Submit any other information or documentation that the Commissioner requires, including any information or documentation to determine the professional competence, good character, and trustworthiness of the motor vehicle rental company.
Regulation .05 Issuance, Term, and Renewal of Limited Lines License.LinkCopy Citation
A.
Issuance. The Commissioner shall issue a limited lines license to each applicant who meets the requirements of Regulation .04 of this chapter and Insurance Article, §§10-603 and 10-604, Annotated Code of Maryland.
B.
Term and Renewal. A limited lines license expires every other year on the anniversary date of the issuance of the license unless renewed as provided in Insurance Article, §10-115, Annotated Code of Maryland.
Regulation .06 Disclosures.LinkCopy Citation
A.
In General. Before the completion of a rental transaction, a motor vehicle rental company shall provide to a prospective renter who purchases any of the insurance coverages a disclosure that meets the requirements of this regulation.
B.
Sale or Offer of Insurance on Business Premises. If a motor vehicle rental company sells or offers to sell insurance on any business premises of the motor vehicle rental company in connection with, and incidental to, a rental agreement, the motor vehicle rental company shall prominently display on the premises and make readily available to prospective renters a disclosure that meets the requirements of §F of this regulation.
C.
Sale or Offer of Insurance Over Telephone. If a motor vehicle rental company sells or offers to sell insurance over the telephone in connection with, and incidental to, a rental agreement, the motor vehicle rental company shall, if the prospective renter requests insurance coverage or information on insurance coverage or otherwise indicates an interest in insurance coverage, advise the prospective renter that the State of Maryland has a consumer disclosure relating to insurance coverage for rental vehicles and offer to read the prospective renter a disclosure that meets the requirements of §F of this regulation.
D.
Sale or Offer of Insurance Through a Web Site. If a motor vehicle rental company sells or offers to sell insurance through a web site in connection with, and incidental to, a rental agreement, the motor vehicle rental company shall include on the web site an electronic disclosure that meets the requirements of §F of this regulation:
(1)
As part of any description of the insurance coverage that is included on the web site; and
(2)
On the same screen in close proximity to any click-through process or other electronic process that allows a prospective renter to indicate that the prospective renter would like to purchase insurance.
E.
Completion of Transaction.
(1)
When a renter goes to the business premises of a motor vehicle rental company to take possession of a vehicle pursuant to a rental agreement, the renter may reject or select any insurance coverage offered in connection with, and incidental to, the rental agreement regardless of any previous decision that the renter made by telephone or over the internet regarding insurance coverage.
(2)
An insurer, or a motor vehicle rental car company on behalf of an insurer, may not charge a renter a premium for any insurance coverage that the renter rejects when the renter takes possession of a vehicle regardless of any previous decision that the renter made by telephone or over the internet regarding insurance coverage.
F.
Form and Content of Disclosure. The disclosures required by §§A—D of this regulation shall include the following:
(1)
A summary that clearly and correctly describes the material terms of coverage offered to the renter, including any limitations or exclusions pertaining to that coverage;
(2)
The name of the authorized insurer;
(3)
A statement that the coverage offered by the motor vehicle rental company may provide duplication of coverage already provided by the renter's personal automobile insurance policy, homeowner's insurance policy, personal liability policy, or other source of coverage;
(4)
A statement, if in writing in at least 10-point type, that:
(5)
A description of the process through which the renter can file a claim, including the insurer's address, and where the claim should be filed.
G.
Filing and Approval of Disclosure.
(1)
Before providing the written disclosure required by §B of this regulation to a prospective renter, a motor vehicle rental company shall file with the Commissioner a copy of all written materials containing the disclosure.
(2)
Before providing the oral disclosure required by §C of this regulation to a prospective renter over the telephone, a motor vehicle rental company shall file the text of the oral disclosure with the Commissioner.
(3)
Before providing the electronic disclosure required by §D of this regulation to a prospective renter through a web site, a motor vehicle rental company shall:
(a)
Provide the Commissioner with access to an electronic prototype of the web site; or
(b)
File with the Commissioner a printout of each screen that contains the disclosure.
(4)
The Commissioner may disapprove a written, oral, or electronic disclosure at any time if the Commissioner determines that the disclosure does not comply with Insurance Article, §10-604, Annotated Code of Maryland.
(5)
If the Commissioner does not disapprove a written or oral disclosure, the disclosure is deemed to be approved 60 days after filing.
(6)
If the Commissioner does not disapprove an electronic disclosure through a web site, the disclosure is deemed to be approved 60 days after:
(a)
The Commissioner is provided with access to an electronic prototype of the web site; or
(b)
A printout of each screen that contains the disclosure is filed with the Commissioner.
(7)
The Commissioner may extend the time for review of a disclosure under §G(5) or (6) of this regulation for not more than 30 days.
Regulation .07 Training Program.LinkCopy Citation
A.
In General.
(1)
Each motor vehicle rental company shall have a training program for its employees who sell, solicit, or negotiate insurance coverage under this chapter.
(2)
Employees shall take the course, in person, before selling, soliciting, or negotiating insurance coverage.
B.
The training program shall include instruction:
(1)
About the kinds of insurance that motor vehicle rental companies may sell or offer under this chapter;
(2)
That the trainee shall inform a renter that purchasing any insurance from the motor vehicle rental company is not required in order to rent a vehicle;
(3)
That the trainee shall inform a renter that the purchase of insurance may be a duplication of coverage already provided by the renter's personal automobile insurance policy, homeowner's insurance policy, liability policy, or other source of coverage; and
(4)
About all the other requirements of Insurance Article, §§10-605 and 10-606, Annotated Code of Maryland.
C.
Approval of Training Program.
(1)
The training program shall be approved by the Commissioner before it is implemented.
(2)
A motor vehicle rental company that proposes to conduct a training program shall file with the Commissioner:
(a)
A description or outline of the course or video tapes of the course;
(b)
Copies of all written materials to be used in the course or with the video tapes; and
(c)
A list of instructors and their qualifications.
Chapter 12. Procedures — Written Consent — Federal Law
Regulation .01 Purpose.LinkCopy Citation
The purpose of this chapter is to establish procedures and requirements for individuals who are required by 18 U.S.C. §1033 to obtain written consent from the Commissioner before the individuals may engage in the business of insurance in the State.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Application counselor” has the meaning stated in Insurance Article, §31-101(a-1), Annotated Code of Maryland.
(2)
Application Form.
(a)
“Application form” means a standardized application form developed by the Insurance Administration for submission by individuals applying for a written consent to engage in the business of insurance in the State under this chapter.
(b)
“Application form” includes the short application form and the comprehensive application form.
(3)
Business of Insurance.
(a)
“Business of insurance” means writing insurance or reinsuring risks.
(b)
“Business of insurance” includes:
(i)
All acts necessary or incidental to writing insurance or reinsuring risks;
(ii)
The activities of an individual who acts as, or is, an officer, director, agent, or employee of an insurer; and
(iii)
The activities of any other individual who is authorized to act on behalf of an officer, director, agent, or employee of an insurer.
(4)
“Commissioner” means the Maryland Insurance Commissioner.
(5)
“Felony involving breach of trust” includes any felony constituting or involving misuse, misapplication, or misappropriation of anything of value that:
(a)
Is held as a fiduciary; or
(b)
Belongs to any public, private, or charitable organization.
(6)
“Felony involving dishonesty” includes any felony constituting or involving:
(a)
Perjury;
(b)
Bribery;
(c)
Forgery;
(d)
Counterfeiting;
(e)
False or misleading oral or written statements;
(f)
Deception;
(g)
Fraud;
(h)
Schemes or artifices to deceive or defraud;
(i)
Material misrepresentation; and
(j)
Failure to disclose material facts.
(7)
“Fiduciary” includes an individual acting as:
(a)
A trustee;
(b)
An administrator;
(c)
An executor;
(d)
A conservator;
(e)
A receiver;
(f)
A guardian;
(g)
An agent;
(h)
An employee;
(i)
A partner;
(j)
An officer;
(k)
A director; or
(l)
A public servant.
(8)
“Individual Exchange” has the meaning stated in Insurance Article, §31-101(h), Annotated Code of Maryland.
(9)
“Individual Exchange navigator” has the meaning stated in Insurance Article, §31-101(i), Annotated Code of Maryland.
(10)
“Interstate commerce” means commerce:
(a)
Within the District of Columbia or any territory or possession of the United States;
(b)
Between any point in a state, territory, possession, or the District of Columbia and any point outside the state, territory, possession, or the District of Columbia;
(c)
Between points within the same state through any place outside the state; or
(d)
Over which the United States has jurisdiction.
(11)
“NAIC” means the National Association of Insurance Commissioners.
(12)
“SHOP Exchange” has the meaning stated in Insurance Article, §31-101(w), Annotated Code of Maryland.
(13)
“SHOP Exchange navigator” has the meaning stated in Insurance Article, §31-101(x), Annotated Code of Maryland.
(14)
“State” means:
(a)
Any state;
(b)
The District of Columbia;
(c)
The Commonwealth of Puerto Rico;
(d)
The Northern Mariana Islands;
(e)
The Virgin Islands;
(f)
American Samoa; and
(g)
The Trust Territory of the Pacific Islands.
Regulation .03 Written Consent Required.LinkCopy Citation
A.
Scope. This regulation applies to the following individuals:
(1)
An officer, director, or employee of a domestic insurer;
(2)
An individual who performs substantial insurance-related activities for a domestic insurer or a resident licensee, including:
(a)
An insurance producer;
(b)
A third-party administrator;
(c)
An independent contractor;
(d)
An actuary;
(e)
A reinsurer;
(f)
An underwriter; and
(g)
An adjuster; and
(3)
An individual who maintains a resident license or certificate of qualification in Maryland, including:
(a)
An insurance producer;
(b)
A managing general agent;
(c)
An adjuster;
(d)
A SHOP exchange navigator;
(e)
An individual exchange navigator; and
(f)
An application counselor.
B.
Consent Required. If an individual to whom this regulation applies has been convicted of a felony involving dishonesty, a felony involving breach of trust, or a violation of the federal Violent Crime Control and Law Enforcement Act of 1994, the individual may not engage in the business of insurance affecting interstate commerce in Maryland unless the individual obtains the written consent of the Insurance Commissioner.
C.
Exceptions. Notwithstanding §B of this regulation, an individual is not required to obtain the written consent of the Insurance Commissioner if:
(1)
The conviction of the individual has been expunged; or
(2)
The individual has been pardoned for the conviction.
Regulation .04 Application for Written Consent.LinkCopy Citation
A.
In General. An individual who is required to obtain written consent to engage in the business of insurance shall comply with the requirements of this regulation.
B.
Application Form.
(1)
Except as provided in §B(2) of this regulation, an applicant for written consent shall submit the short application form to the Commissioner.
(2)
An applicant for written consent shall submit the comprehensive application form to the Commissioner if:
(a)
The applicant intends to act as an insurance producer; or
(b)
Following review of the applicant's short application form, the Commissioner:
(i)
Determines that the applicant may be a threat to the public; and
(ii)
Requests the applicant to submit a comprehensive application form.
(3)
An applicant shall attach two recent 2 inch by 2 inch photographs of the applicant to the upper right hand corner of the application form.
(4)
The application form shall include a notarized signature of the applicant affirming that the information provided in the application form is truthful and complete.
C.
Credit Report. An applicant shall submit to the Commissioner a credit report prepared within 30 days of the date of application and certified by a credit bureau.
D.
Request for Criminal Records Check.
(1)
An applicant shall apply for a records check for the existence of criminal convictions in the criminal history records information maintained by the Criminal Justice Information System Central Repository of the Department of Public Safety and Correctional Services and received from the Federal Bureau of Investigation by:
(a)
Completing and submitting, in a manner approved by the Director of the Central Repository, an application containing identifying information, including the applicant's Social Security number, to verify identity and preserve the security of the record maintained by the Central Repository;
(b)
Submitting two complete sets of legible fingerprints taken on forms approved by the Director and the Federal Bureau of Investigation; and
(c)
Paying the applicable processing fees.
(2)
The applicant shall submit a copy of the application for a criminal records check to the Commissioner.
E.
Character References.
(1)
An application shall be accompanied by at least three letters of reference addressed to the Commissioner, attesting to the character and reputation of the applicant.
(2)
An individual who provides a letter of reference may not be related to the applicant by blood or marriage.
(3)
A letter of reference shall:
(a)
Indicate the length of time and the capacity in which the individual writing the letter has known the applicant;
(b)
Describe the applicant's character traits as they relate to the employment, position, or duties for which written consent is sought; and
(c)
State that the individual writing the letter is aware that the letter of reference is being provided in connection with a request for written consent to engage in the business of insurance despite the existence of a felony conviction.
F.
Additional Information. An applicant may submit any additional documents or information that the applicant would like the Commissioner to consider.
Regulation .05 Review of Application.LinkCopy Citation
A.
In General. On receipt of an application for written consent and the required accompanying information, the Commissioner shall review the application and information in accordance with this regulation to determine if the applicant should be granted written consent to engage in the business of insurance in the State.
B.
Notification of NAIC Members.
(1)
On receipt of an application for written consent, the Commissioner shall notify all other members of the NAIC that an application for written consent has been filed, identifying:
(a)
The name, address, and Social Security number of the applicant; and
(b)
The types of insurance activities to be conducted by the applicant.
(2)
The Commissioner shall allow at least 30 days for other members of the NAIC to respond with any relevant information about the applicant.
C.
Standard of Review.
(1)
The Commissioner shall determine if:
(a)
The applicant has been fully rehabilitated and no longer poses a risk or threat to insurance consumers or insurers; and
(b)
The issuance of written consent to the applicant is consistent with the public interest, federal and Maryland law, and any applicable court orders.
(2)
The Commissioner may grant written consent only if the mitigating circumstances clearly and substantially outweigh the seriousness of the applicant's criminal history together with any other aggravating circumstances.
(3)
In reviewing an application for written consent, the factors considered by the Commissioner shall include:
(a)
The interest in protecting property and the safety and welfare of consumers, businesses, and the general public;
(b)
The nature and severity of the act for which the applicant was convicted;
(c)
The date of the conviction;
(d)
The injury or loss caused by the act for which the applicant was convicted;
(e)
Whether the conviction is related to the business of insurance;
(f)
Whether the applicant completed a parole or probation;
(g)
Whether the applicant has been charged with, indicted for, or convicted of any other crimes;
(h)
Any evidence of the applicant's rehabilitation, including:
(i)
Good conduct in prison or in the community;
(ii)
Counseling or psychiatric treatment received;
(iii)
Acquisition of additional academic or vocational training;
(iv)
Successful participation in correctional work-release programs; and
(v)
The recommendation of individuals who have had the applicant under their supervision;
(i)
The nature and strength of any character references;
(j)
The applicant's business and personal record before and after commission of the crime;
(k)
Whether and to what extent the applicant has made material false statements in an application, renewal, or other document filed with the Commissioner; and
(l)
Whether and to what extent the applicant has made material false statements in applications or other documents filed with other state or federal agencies.
D.
Additional Information.
(1)
The Commissioner may request any additional documents or information that the Commissioner considers necessary to determine if an applicant should be granted written consent to engage in the business of insurance in Maryland.
(2)
If the Commissioner requests additional documents or information, the applicant shall submit the documents or information to the Commissioner within 30 days after receiving the request.
(3)
If an applicant fails to submit the requested documents or information to the Commissioner within 30 days, the application of the applicant shall be considered withdrawn.
E.
Verification of Duties. The Commissioner may verify with the applicant's employer or prospective employer the duties that the applicant will be performing for the employer.
Regulation .06 Grant of Written Consent.LinkCopy Citation
A.
In General. If the Commissioner decides to grant the applicant's request for written consent, the Commissioner shall issue a written consent to the applicant.
B.
Scope of Written Consent.
(1)
The written consent shall be:
(a)
Specific as to job duties; and
(b)
Conditioned on the individual remaining in a position with substantially similar duties.
(2)
If an individual who holds a written consent wishes to engage in additional duties within the business of insurance, the individual shall obtain a new written consent that includes those duties.
(3)
If an individual who holds a written consent assumes significantly different job duties without obtaining a new written consent, the written consent of the individual is immediately invalidated.
(4)
An individual who holds a written consent and changes employers is not required to obtain a new written consent if the individual's job duties with the new employer are substantially similar to the individual's job duties with the individual's former employer.
C.
Truth and Veracity of Information.
(1)
A written consent shall be conditioned on the truth and veracity of the documents and information submitted by or on behalf of the applicant.
(2)
If the applicant has made materially false or misleading statements or has failed to disclose material information, the written consent is void ab initio.
D.
Temporary Written Consent. The Commissioner may grant temporary written consent.
E.
Notification of NAIC Members. If the Commissioner grants a request for written consent, the Commissioner shall notify all other members of the NAIC.
Regulation .07 Denial of Written Consent.LinkCopy Citation
A.
Order. If the Commissioner denies the applicant's request for written consent, the Commissioner shall issue an order that:
(1)
States that the request is denied; and
(2)
Explains the reasons for the denial.
B.
Licensing Prohibited. An applicant who has been denied a written consent may not be granted or continue to hold a license or certificate of qualification to engage in the business of insurance in Maryland.
C.
Notification of NAIC Members. If the Commissioner denies an applicant's request for written consent, the Commissioner shall notify all other members of the NAIC.
Regulation .08 Hearing.LinkCopy Citation
The Commissioner shall hold a hearing in accordance with Insurance Article, §2-210, Annotated Code of Maryland, on the demand of any applicant who is aggrieved by:
A.
The denial of written consent by the Commissioner; or
B.
The scope of a written consent issued by the Commissioner.
Regulation .09 Subsequent Conviction.LinkCopy Citation
A.
Written Consent Invalidated Immediately. If an individual who has been granted written consent is subsequently convicted of a felony, the written consent of the individual is invalidated immediately without the necessity of any further action by the Commissioner.
B.
Notification. An individual who has been granted written consent and is subsequently convicted of a felony shall:
(1)
Immediately notify the Commissioner, the individual's employer, and any insurers with which the individual holds an appointment; and
(2)
Provide to the Commissioner all relevant documents and information about the felony conviction.
Chapter 13. Producer Registers and Documentation of Appointments
Regulation .01 Definition.LinkCopy Citation
A.
In this chapter, the following term has the meaning indicated.
B.
Term Defined. “Producer register” means a register of appointed insurance producers who are authorized to sell, solicit, or negotiate contracts of insurance on behalf of an insurer.
Regulation .02 Producer Register.LinkCopy Citation
A.
Required. An insurer authorized to transact the business of insurance in the State shall maintain a producer register.
B.
Form and Content.
(1)
Within 30 days after appointing an insurance producer, an insurer shall add the following information to the insurer's producer register:
(a)
The Maryland license number of the insurance producer;
(b)
If the insurance producer is an individual, the first and last name and residence or business address of the individual;
(c)
If the insurance producer is a business entity:
(i)
The tax ID number of the insurance producer;
(ii)
The name of the business entity; and
(iii)
The address of the business entity; and
(d)
The date that the insurance producer was appointed.
(2)
Within 30 days after the effective date of an insurer's termination of an appointment of an insurance producer, the insurer shall add the following information to the insurer's producer register:
(a)
The effective date of the termination of the appointment; and
(b)
An identifier that indicates if the termination was wholly or partly the result of a belief that the insurance producer engaged or is engaging in any of the activities set forth in Insurance Article, §10-126, Annotated Code of Maryland.
(3)
Each item that an insurer is required to include in its producer register under §B(1) and (2) of this regulation shall be entered:
(a)
On a separate line or space; or
(b)
If the producer register is maintained electronically, in a separate searchable field.
(4)
If an insurer maintains its producer register electronically, the insurer shall maintain the producer register in a manner that allows the information in the producer register to be retrieved within 10 working days after a request from the Insurance Commissioner.
Regulation .03 Updating and Maintaining Producer Register.LinkCopy Citation
A.
At least once every 31 days, an insurer shall determine whether the license of any insurance producer who currently is appointed by the insurer has been suspended or revoked.
B.
After determining that the license of an insurance producer who currently is appointed by an insurer has been suspended or revoked, the insurer shall:
(1)
Within 5 business days after making the determination, terminate the appointment of the insurance producer; and
(2)
Within 30 days after the effective date of the termination, update the insurer's producer register to reflect the termination of the appointment in accordance with Regulation .02B(2) of this chapter.
C.
An insurer shall maintain its producer register for as long as the insurer acts as an insurer in the State.
D.
If an insurer ceases to act as an insurer in the State due to a sale, merger, consolidation, or other transaction:
(1)
The insurer shall transfer its producer register to the successor insurer that acquires the business of the insurer; and
(2)
The successor insurer shall maintain the producer register for as long as the successor insurer acts as an insurer in the State.
Regulation .04 Documentation of Appointment.LinkCopy Citation
A.
Within 30 days after appointing an insurance producer, an insurer shall provide the insurance producer with written documentation of the appointment that contains, at a minimum:
(1)
The name of the insurer;
(2)
The date that the documentation was provided to the insurance producer;
(3)
The Maryland license number of the insurance producer;
(4)
If the insurance producer is an individual, the first and last name of the individual;
(5)
If the insurance producer is a business entity, the name of the business entity;
(6)
The date that the insurance producer was appointed; and
(7)
The following statement, prominently displayed on the written documentation: “This document shall be retained while your appointment is in effect and for at least 5 years after the termination of your appointment.”
B.
An insurer may provide the written documentation to an insurance producer electronically if the insurance producer agrees to receive the written documentation electronically.
Regulation .05 Maintenance of Information by Insurance Producer.LinkCopy Citation
A.
A licensed insurance producer that has received written documentation of an appointment from an insurer shall maintain:
(1)
The documentation of the insurer's appointment that is provided by the insurer under Regulation .04 of this chapter; and
(2)
A list of insurers that have appointed the insurance producer.
B.
If an insurance producer maintains the information required to be maintained by §A of this regulation electronically, the insurance producer shall maintain the information in a manner that allows the information to be retrieved within 10 working days after a request from the Insurance Commissioner.
C.
With respect to a particular appointment, the insurance producer shall maintain the information required to be maintained by §A of this regulation:
(1)
While the appointment is in effect; and
(2)
For at least 5 years after the termination of the appointment.
Regulation .06 Producer Action on Behalf of Insurer.LinkCopy Citation
On appointment by an insurer, a licensed producer that has written documentation of the appointment pursuant to Regulation .04 of this chapter may act on behalf of the insurer before the insurer adds the producer to its register.
Chapter 14. Notice of Payment Options When Premium Financing is Offered
Regulation .01 Purpose.LinkCopy Citation
A.
The purpose of this chapter is to assure fair disclosure of availability of alternative payment plans and financing options when consumers purchase property and casualty insurance.
B.
This chapter is also designed to aid consumers by creating an industry standard with regard to required disclosure of insurers' alternative payment plans and premium financing agreements.
Regulation .02 Scope.LinkCopy Citation
This chapter does not apply to life insurance, health insurance, or annuities.
Regulation .03 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Casualty insurance” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
(2)
“Insurance producer” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
(3)
“Policy” means an individual or group policy, contract, or certificate issued by an insurer.
(4)
“Premium finance agreement” has the meaning stated in Insurance Article, §23-101, Annotated Code of Maryland.
(5)
“Premium finance company” has the meaning stated in Insurance Article, §23-101, Annotated Code of Maryland.
(6)
“Property insurance” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
Regulation .04 Notice of Payment Options.LinkCopy Citation
A.
With respect to property and casualty insurance policies, an insurance producer may not finance an insurance premium unless the insurance producer first makes a disclosure to the applicant or insured that:
(1)
Provides the applicant or insured with a comparison of the costs and terms of the premium finance agreement with the insurer's alternative payment plan or plans, if the insurer offers an alternative; and
(2)
Is signed by the applicant or insured.
B.
The disclosure required by §A of this regulation shall:
(1)
State the total amount to be paid by the applicant or insured under the premium finance agreement during the policy term, including premium, any down payment, and all interest, fees, and charges incident to the premium finance agreement and resulting extension of credit; and
(2)
State the total amount to be paid by the applicant or insured under the insurer's alternative payment plan or plans during the policy term, including premium, any down payment, and all fees and charges incident to the alternative payment plan or plans.
Regulation .05 Retention of Signed Disclosure Forms.LinkCopy Citation
A.
An insurance producer that has provided an insured or applicant for property and casualty insurance with the various payment options available shall maintain the signed disclosure form required under Regulation .04 of this chapter, for a period of at least 5 years after the date the disclosure form is signed.
B.
If an insurance producer maintains the signed disclosure form required to be maintained under §A of this regulation electronically, the insurance producer shall maintain the signed disclosure form in a manner that allows the form to be retrieved within 10 working days after a request from the Insurance Commissioner.
Chapter 15. Senior or Retiree Designations and Credentials
Regulation .01 Purpose.LinkCopy Citation
The purpose of this chapter is to protect seniors and retirees as purchasers of health insurance, life insurance, and annuity contracts, against the use of sales methods which are misleading.
Regulation .02 Scope.LinkCopy Citation
A.
This chapter applies to advisors and insurance producers.
B.
Under this chapter it is a violation of Insurance Article, Title 27, Annotated Code of Maryland, to use a senior specific designation or certification in a way that misleads or would mislead any person to indicate that the user has special certification or training in advising or serving senior citizens or retirees:
(1)
When advising about life insurance, health insurance, or annuities; or
(2)
In connection with the offer, sale, or purchase of life insurance, health insurance, or annuities.
Regulation .03 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Advisor” has the meaning stated in Insurance Article, §10-201, Annotated Code of Maryland.
(2)
“Annuity” means annuity as defined in Insurance Article, §1-101, Annotated Code of Maryland.
(3)
“Commissioner” means the Maryland Insurance Commissioner.
(4)
“Financial services regulatory agency” includes, for the purposes of this chapter, an agency that regulates broker-dealers, investment advisers, or investment companies as defined under the Investment Company Act of 1940.
(5)
“Health insurance” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
(6)
“Life insurance” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
(7)
“Insurance producer” has the meaning stated in Insurance Article, §1-101, Annotated Code of Maryland.
Regulation .04 Prohibited Use of Certification or Professional Designation.LinkCopy Citation
The prohibited use of a certification or professional designation includes the following:
A.
Use of certification or professional designation by a person who has not actually earned or is ineligible to use the certification or designation;
B.
Use of nonexistent or self-conferred certification or professional designation;
C.
Use of certification or professional designation that indicates a level of occupational qualifications obtained through education, training, or experience that the user does not have; and
D.
Use of a certification or professional designation that was obtained from a designating or certifying organization that:
(1)
Is primarily engaged in the business of instruction in sales, marketing, or sales and marketing;
(2)
Does not have reasonable standards or procedures for assuring the competency of its designees or certificate holders;
(3)
Does not have reasonable standards or procedures for monitoring and disciplining it designees or certificate holders for improper or unethical conduct; or
(4)
Does not have reasonable continuing education requirements for its designees or certificate holders in order to maintain the designation or certification.
Regulation .05 Rebuttable Presumption.LinkCopy Citation
A.
There is a rebuttable presumption that a designating or certifying organization is not disqualified solely for purposes of this chapter if:
(1)
The organization has been accredited by:
(a)
The American National Standards Institute or The National Commission for Certifying Agencies; or
(b)
The organization is on the United States Department of Education’s list entitled “Accrediting Agencies Recognized for Title IV Purposes” and the issued designation or credential does not primarily apply to sales, marketing, or sales and marketing.
B.
The following factors shall be considered when determining whether a combination of words, or an acronym standing for a combination of words constitutes a certification or professional designation indicating or implying that a person has special certification or training in advising or servicing senior citizens or retirees:
(1)
Use, in the name of the certification or professional designation, of one or more words such as “senior”, “retirement,” “elder”, or similar terms, combined with one or more words such as “certified”, “registered”, “chartered”, “adviser”, “specialist”, “consultant”, “planner”, or similar terms; and
(2)
The manner in which the words described in §B(1) of this regulation are combined.
Regulation .06 Exceptions.LinkCopy Citation
For purposes of this chapter, a certification or professional designation does not include a job title within an organization that is licensed or registered by a state or federal financial services regulatory agency, when that job title:
A.
Indicates seniority or standing within the organization; or
B.
Specifies an individuals’ area of specialization within the organization.
Regulation .07 Enforcement.LinkCopy Citation
Nothing in this chapter shall limit the Commissioner’s authority to enforce existing provisions of law.
Chapter 16. SHOP Exchange Navigators — Licensing
Regulation .01 Purpose.LinkCopy Citation
The purpose of this chapter is to establish certain requirements that must be satisfied in order to qualify for a SHOP Exchange navigator license.
Regulation .02 Applicability.LinkCopy Citation
This chapter applies to any person seeking to act as a SHOP Exchange navigator.
Regulation .03 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meaning indicated.
B.
Terms Defined.
(1)
“Administration” means the Maryland Insurance Administration.
(2)
“Applicant” means a person who is applying for a SHOP Exchange navigator license.
(3)
“Application” means a written request for a license in a form approved by the Commissioner.
(4)
“Commissioner” means the Maryland Insurance Commissioner.
(5)
“Effective Date” means the date on which a license takes effect.
(6)
“Examination” means the written pre-licensing examination given under the authority of the Commissioner pursuant to Insurance Article, §31-112(d), Annotated Code of Maryland.
(7)
“License” means a SHOP Exchange navigator license.
(8)
“Licensee” means a SHOP Exchange navigator.
(9)
“Maryland Health Benefit Exchange” means the public corporation established under Insurance Article, §31-102, Annotated Code of Maryland.
(10)
“SHOP Exchange” has the meaning set forth in Insurance Article, §31-101(w), Annotated Code of Maryland.
(11)
“SHOP Exchange navigator” has the meaning set forth in Insurance Article, §31-101(x), Annotated Code of Maryland.
(12)
“SHOP Exchange navigator license” has the meaning set forth in Insurance Article, §31-101(y), Annotated Code of Maryland.
(13)
“Training Program” means the educational program offered to an applicant by the SHOP Exchange that must be completed subject to Insurance Article, §31-112(c)(2)(v), Annotated Code of Maryland.
Regulation .04 Licensing Requirements.LinkCopy Citation
A.
Before a person may act as a SHOP Exchange navigator in the State, the person shall obtain a license issued by the Commissioner.
B.
To qualify for a license, an applicant:
(1)
Shall be at least 18 years of age;
(2)
Shall successfully complete the training program;
(3)
Shall complete and pass both sections of the examination;
(4)
Shall submit an application and any additional information the Commissioner deems necessary to the Administration;
(5)
Shall pay to the Administration initial license and application fees if permitted by law;
(6)
Shall be of good character and trustworthy; and
(7)
May not have committed any act the Commissioner finds would warrant suspension or revocation of a license under Insurance Article, §31-112(e), Annotated Code of Maryland.
Regulation .05 Examination.LinkCopy Citation
A.
To qualify to take the examination, an applicant must submit evidence of successful completion of the training program.
B.
The examination shall be:
(1)
Divided into a State-specific section and a general section;
(2)
Based on a content outline that is approved by the Commissioner in consultation with the Maryland Health Benefit Exchange;
(3)
Reviewed by the Commissioner on a periodic basis, in consultation with the Maryland Health Benefit Exchange, to ensure that it accurately measures an applicant’s competency in the required areas of knowledge;
(4)
In writing, but may be administered electronically to an applicant;
(5)
Conducted in specified locations throughout the State which have been approved by the Commissioner;
(6)
Conducted in facilities that comply with the Americans with Disabilities Act of 1990 as amended by 42 U.S.C. §12101, et seq.; and
(7)
Administered quarterly, or more frequently if deemed appropriate by the Commissioner.
C.
Each section of the examination shall be scored separately.
D.
The Commissioner shall establish a minimum passing score, in consultation with the Maryland Health Benefit Exchange, for each section of the examination.
E.
An applicant who fails a single section of the examination may retake the failed section of the examination within 1 year of the initial examination date. If the applicant does not pass the failed section within that time, the applicant must retake both sections of the examination to be eligible to pass the examination. The examination may be taken no more than three times in a 6-week period.
Regulation .06 Changes to Information in the Application.LinkCopy Citation
A.
Within 30 days after a change to any information in an initial or renewal application, a licensee shall file with the Commissioner, in a form required by the Commissioner, the change in information.
B.
If a licensee fails to timely file with the Commissioner a change to the information specified in §A of this regulation, the licensee is in violation of Insurance Article, §31-112(e)(1)(i), Annotated Code of Maryland.
Regulation .07 License Term.LinkCopy Citation
A.
An initial license expires on the last day of the licensee’s birth month following the second anniversary of the effective date of the initial license.
B.
A renewal license expires on the second anniversary of its effective date.
Regulation .08 License Renewal.LinkCopy Citation
A.
To qualify to renew a license, a licensee:
(1)
Shall submit to the Commissioner a renewal application approved by the Commissioner;
(2)
Shall pay a license renewal fee if permitted by law;
(3)
Shall submit to the Commissioner any additional information the Commissioner deems necessary;
(4)
Shall complete the continuing education requirements as set forth in §A(7) of this regulation;
(5)
Shall be of good character and trustworthy;
(6)
May not have committed any act the Commissioner finds would warrant suspension or revocation of a license under Insurance Article, §31-112(e), Annotated Code of Maryland;
(7)
Shall complete 16 credit hours of continuing education during the prior license period as approved by the Administration in consultation with the Maryland Health Benefit Exchange. The credit hours shall include the following:
(a)
A minimum of 9 credit hours in health insurance; and
(b)
A minimum of 3 credit hours in ethics;
(8)
Shall have paid all undisputed taxes and unemployment insurance contributions payable to the Comptroller of Maryland and the Secretary of Labor or have provided for payment in a manner satisfactory to the unit responsible for collection; and
(9)
Shall have paid any amount in arrears on an applicant’s child support obligation, if any, or have provided for payment in a manner satisfactory to the unit responsible for collection.
B.
A renewal application is considered timely filed if:
(1)
The application contains all of the required information;
(2)
The renewal license fee, if permitted by law, has been received by the Administration; and
(3)
The application is:
(a)
Mailed and postmarked on or before the expiration date of the license; or
(b)
Submitted electronically and received by an information processing system that the Administration has designated for the purpose of receiving electronic applications prior to the expiration date of the license.
C.
If, at least 2 calendar weeks before a license expires, the licensee makes sufficient application for renewal of the license, the license shall not expire until:
(1)
The Administration takes final action on the renewal application; and
(2)
The time for seeking judicial review of the action expires or any judicial stay of the Administration’s final action expires.
Regulation .09 Expired License Reinstatement.LinkCopy Citation
A.
An individual whose license has expired:
(1)
Is prohibited from acting as a SHOP Exchange navigator in the State; and
(2)
For up to 1 year after the expiration date of the license, may obtain reinstatement of the expired license by:
(a)
Submitting to the Commissioner a reinstatement application approved by the Commissioner;
(b)
Meeting all of the renewal requirements under Regulation .08(A) and (B) of this chapter; and
(c)
Paying to the Administration the reinstatement fee, if permitted by law.
B.
An individual who does not qualify for reinstatement under §A(2) of this regulation may apply for an initial license as described in Regulation .04 of this chapter.
C.
The Commissioner may waive the reinstatement procedures for a SHOP Exchange navigator who is unable to comply with the renewal and reinstatement procedures due to:
(1)
Military service; or
(2)
Other extenuating circumstances, including a long-term medical disability.
Chapter 17. Consolidated Services Center — SHOP Exchange Enrollment Permits
Regulation .01 Purpose.LinkCopy Citation
The purpose of this chapter is to establish certain requirements that shall be satisfied in order to qualify for a SHOP Exchange enrollment permit.
Regulation .02 Applicability.LinkCopy Citation
This chapter applies to any employee of the Consolidated Services Center seeking to provide the services set forth in Insurance Article, §31-112(c)(1), Annotated Code of Maryland.
Regulation .03 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meaning indicated.
B.
Terms Defined.
(1)
“Administration” means the Maryland Insurance Administration.
(2)
“Applicant” means a person who is applying for a SHOP Exchange enrollment permit.
(3)
“Application” means a written request for a permit in a form approved by the Commissioner.
(4)
“Commissioner” means the Maryland Insurance Commissioner.
(5)
“Consolidated Services Center” has the meaning set forth in Insurance Article, §31-101(c-2), Annotated Code of Maryland.
(6)
“Effective date” means the date on which a permit takes effect.
(7)
“Examination” means the examination given under the authority of the Commissioner pursuant to Insurance Article, §31-112(d), Annotated Code of Maryland.
(8)
“Maryland Health Benefit Exchange” means the public corporation established under Insurance Article, §31-102, Annotated Code of Maryland.
(9)
“Permit” means a SHOP Exchange enrollment permit.
(10)
“SHOP Exchange” has the meaning set forth in Insurance Article, §31-101(w), Annotated Code of Maryland.
(11)
“SHOP Exchange Enrollment Permit” means a permit issued by the Commissioner to Consolidated Services Center employees, as required under Insurance Article, §31-113.1(b)(3), Annotated Code of Maryland.
(12)
“SHOP Exchange Navigator License” has the meaning set forth in Insurance Article, §31-101(y), Annotated Code of Maryland.
(13)
“Training program” means the educational program offered to an applicant by the SHOP Exchange that must be completed subject to Insurance Article, §31-112(2)(v), Annotated Code of Maryland.
Regulation .04 Permit Requirements.LinkCopy Citation
A.
Before an employee of the Consolidated Services Center may provide the services set forth in Insurance Article,
§31-112(c)(1), Annotated Code of Maryland, the person shall obtain a permit issued by the Commissioner.
§31-112(c)(1), Annotated Code of Maryland, the person shall obtain a permit issued by the Commissioner.
B.
To qualify for a permit, an applicant shall:
(1)
Be at least 18 years of age;
(2)
Successfully complete the training program;
(3)
Complete and pass both sections of the examination;
(4)
Submit an application and any additional information the Commissioner deems necessary to the Administration;
(5)
Pay to the Administration initial permit and application fees if permitted by law;
(6)
Be of good character and trustworthy;
(7)
Not have committed any act the Commissioner finds would warrant suspension or revocation of a permit under Insurance Article, §31-113.1(b)(4), Annotated Code of Maryland; and
(8)
Be engaged by the Consolidated Services Center and receive compensation only through the Consolidated Services Center.
Regulation .05 Examination.LinkCopy Citation
A.
For an applicant to qualify to take the examination, the Maryland Health Benefit Exchange, or its designee, must submit evidence of the applicant’s successful completion of the training program to the Commissioner.
B.
The examination shall be the same examination administered by the Commissioner to those individuals seeking a SHOP Exchange Navigator License.
C.
An applicant who fails a single section of the examination may retake the failed section of the examination within 1 year of the initial examination date. If the applicant does not pass the failed section within that time, the applicant shall retake both sections of the examination to be eligible to pass the examination. The examination may not be taken more than three times in a 6-week period.
Regulation .06 Changes to Information in the Application.LinkCopy Citation
A.
Within 30 days after a change to any information in an initial or renewal application, a permit holder shall file with the Commissioner, in a form required by the Commissioner, the change in information.
B.
If a permit holder fails to timely file with the Commissioner a change to the information specified in §A of this regulation, the permit holder is in violation of Insurance Article, §31-112(e)(1)(i), Annotated Code of Maryland.
Regulation .07 Permit Term.LinkCopy Citation
A.
An initial permit expires on the last day of the permit holder’s birth month following the second anniversary of the effective date of the initial permit.
B.
A renewal permit expires on the second anniversary of its effective date.
Regulation .08 Permit Renewal.LinkCopy Citation
A.
To qualify to renew a permit, a permit holder shall:
(1)
Submit to the Commissioner a renewal application approved by the Commissioner;
(2)
Pay a permit renewal fee if permitted by law;
(3)
Submit to the Commissioner any additional information the Commissioner deems necessary;
(4)
Complete the continuing education requirements as set forth in §A(7) of this regulation;
(5)
Be of good character and trustworthy;
(6)
Not have committed any act the Commissioner finds would warrant suspension or revocation of a SHOP Exchange enrollment permit under Insurance Article, §31-113.1(b)(4), Annotated Code of Maryland;
(7)
Complete 16 credit hours of continuing education during the prior permit period as approved by the Administration in consultation with the Maryland Health Benefit Exchange which shall include the following:
(a)
A minimum of nine credit hours in health insurance; and
(b)
A minimum of three credit hours in ethics;
(8)
Have paid all undisputed taxes and unemployment insurance contributions payable to the Comptroller of Maryland and the Secretary of Labor or has provided for payment in a manner satisfactory to the unit responsible for collection;
(9)
Have paid any amount in arrears on an applicant’s child support obligation, if any, or has provided for payment in a manner satisfactory to the unit responsible for collection; and
(10)
Be engaged by the Consolidated Services Center and receive compensation only through the Consolidated Services Center.
B.
A renewal application is considered timely filed if:
(1)
The application contains all of the required information;
(2)
The renewal permit fee, if permitted by law, has been received by the Administration; and
(3)
The application is:
(a)
Mailed and postmarked on or before the expiration date of the permit; or
(b)
Submitted electronically and received by an information processing system that the Administration has designated for the purpose of receiving electronic applications prior to the expiration date of the permit.
C.
If, at least 2 calendar weeks before a permit expires, the permit holder makes sufficient application for renewal of the permit, the permit shall not expire until:
(1)
The Administration takes final action on the renewal application; and
(2)
The time for seeking judicial review of the action expires or any judicial stay of the Administration’s final action expires.
Regulation .09 Expired Permit Reinstatement.LinkCopy Citation
A.
An individual whose permit has expired:
(1)
Is prohibited from providing the services set forth in the Insurance Article, §31-112(c)(1), Annotated Code of Maryland; and
(2)
For up to 1 year after the expiration date of the permit, may obtain reinstatement of the expired permit by:
(a)
Submitting to the Commissioner a reinstatement application approved by the Commissioner;
(b)
Meeting all of the renewal requirements under Regulation .08A—B(1), (2) and (3)(b) of this chapter; and
(c)
Paying to the Administration the reinstatement fee, if permitted by law.
B.
An individual who does not qualify for reinstatement under §A(2) of this regulation may apply for an initial permit as described in Regulation .04 of this chapter.
C.
The Commissioner may waive the reinstatement procedures for a Consolidated Services Center employee who is unable to comply with the renewal and reinstatement procedures due to:
(1)
Military service; or
(2)
Other extenuating circumstances, including a long-term medical disability.
Chapter 18. Public Adjusters
Regulation .01 Scope.LinkCopy Citation
This chapter does not apply to:
A.
An adjuster for or an insurance producer or employee of an insurer or group of insurers under common control or ownership that, as representative of the insurer or group, adjusts losses or damages under policies issued by the insurer or group;
B.
An insurance producer that acts as an adjuster without compensation for an insured for whom the insurance producer is acting as an insurance producer; or
C.
An attorney at law who does not:
(1)
Regularly act as a public adjuster; and
(2)
Represent to the public by sign, advertisement, or otherwise that the attorney at law acts as a public adjuster.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter the following words have the meanings indicated.
B.
Terms Defined.
(1)
“Administration” means the Maryland Insurance Administration.
(2)
“Business entity” has the meaning stated in Insurance Article, §10-101(c), Annotated Code of Maryland.
(3)
“Course” means a presentation of information delivered in person, in print, electronically, or via teleconference, which is measured by verifiable attendance or examination, or both.
(4)
“Course completion date” means the date when a student has submitted all necessary information to the education provider and, when applicable, successfully met the course attendance requirements or passed the final examination, or both.
(5)
“Course completion roster” means a listing of candidates who have completed a continuing education course, provided in a format determined by the Commissioner, which includes the following:
(a)
The course name, the designated course number, and the course completion date;
(b)
The provider’s identification number;
(c)
The instructor’s license number, if applicable; and
(d)
For each student who completes the course:
(i)
The student’s name;
(ii)
The student’s national producer number or the student’s license number, or both; and
(iii)
The number of hours of continuing education earned by the student.
(6)
“Course coordinator” means an individual who is responsible for organizing a continuing education course, getting it approved by the Insurance Commissioner, and supervising the administration of the course after its approval.
(7)
“Expiration date” means the date the license expires as stated on the license.
(8)
“Hours of continuing education” means 50 minutes of work in a course that has been approved by the Commissioner to receive continuing education credit.
(9)
“Instructor” means a subject matter expert, approved by the Commissioner, presenting course activities or information in a course approved by the Commissioner.
(10)
“License” means a license issued by the Commissioner to act as a public adjuster.
(11)
“Licensed insurance producer” has the meaning stated in Insurance Article, §1-101(w), Annotated Code of Maryland.
(12)
“Provider” means an entity that has been approved by the Commissioner to offer continuing education courses to licensed insurance producers in the State.
(13)
“Public adjuster” has the meaning stated in Insurance Article, §10-401(d), Annotated Code of Maryland.
(14)
“Renewal period” means the period from the issuance or renewal of a license until the day before the expiration date of the license.
(15)
“Renewal year” means the 12-month period from January 1 until December 31 in which a license renewal occurs.
(16)
“Self-study course” means a course that is not presented in a classroom, is not delivered in person, and does not require interaction with an instructor.
(17)
“Successfully complete” means to complete and meet all requirements of an approved course for which a valid certificate of course completion has been issued.
(18)
“Teleconference” means the live exchange of information among several persons who are separately located but linked by audio or video, or both, that provides for opportunities for interactions between student and instructor.
Regulation .03 General Continuing Education Requirements.LinkCopy Citation
A.
Except as provided in §§B and C of this regulation, in order to renew a license, a licensed public adjuster who is not a business entity shall successfully complete in each renewal period at least 24 hours of continuing education as follows:
(1)
At least 3 hours in Ethics; and
(2)
21 hours shall be in courses designated by the Commissioner as “Public Adjuster” or “Property/Casualty”.
B.
If the licensed public adjuster is also a licensed insurance producer and has only a producer license for property insurance, casualty insurance, or a subdivision of property or casualty insurance, the licensee shall obtain necessary hours in courses designated by the Commissioner as “Public Adjuster” or “Property/Casualty”.
C.
If the licensed public adjuster is also a licensed insurance producer and has a producer license for property insurance or casualty insurance, or a subdivision of property or casualty insurance, and life insurance or health insurance, or a subdivision of life or health insurance, then the licensee shall complete:
(1)
A minimum of 6 hours in one or more courses designated Public Adjuster;
(2)
A minimum of 6 hours in one or more courses designated Property/Casualty;
(3)
A minimum of 6 hours in one or more courses designated Life/Health; and
(4)
Three additional hours of continuing education in any course or courses designated for areas specified in §C(1)—(3) of this regulation.
D.
Course of Continuing Education—Passing Scores. Passing scores received on or after the expiration date for the public adjuster’s license shall result in hours of continuing education that may be used for the next renewal period.
E.
A course instructor shall earn 1-1/2 hours of continuing education for each approved hour of instruction of an approved course.
F.
A public adjuster or a course instructor may not earn hours of continuing education for attending or instructing a subsequent offering of the same course in the same renewal period.
Regulation .04 Holders of Expired Licenses Who Seek Reinstatement.LinkCopy Citation
A.
The holder of an expired license who seeks reinstatement of the license under Insurance Article, §10-408.1, Annotated Code of Maryland, shall fulfill the continuing education requirements for the renewal period that concluded on the day before the immediately preceding expiration date of the licensed public adjuster’s license in order to qualify for reinstatement.
B.
A licensed public adjuster who does not have sufficient hours of continuing education on the day before the most recent expiration date of the license will have all hours of continuing education earned on or after the expiration date credited toward the requirement for the renewal period that concluded on the day before the license expired.
Regulation .05 Nonresident Licensed Public Adjusters.LinkCopy Citation
A.
A nonresident licensed public adjuster whose state or residence has a continuing education requirement shall fulfill all of the requirements of the state of residence, and the continuing education requirements of Maryland may not be applicable to the licensed public adjuster.
B.
A nonresident licensed public adjuster whose state of residence does not have a continuing education requirement shall fulfill Maryland continuing education requirements, which may be fulfilled entirely through correspondence courses.
Regulation .06 Licensed Public Adjuster Responsibilities.LinkCopy Citation
A.
A licensed public adjuster shall:
(1)
Maintain a record of the certificate of course completion received for 4 years following the date that the course was completed; and
(2)
Upon request, submit with the renewal application each certification of course completion needed to fulfill the licensed public adjuster’s hours of continuing education for the renewal period.
B.
Under Insurance Article, §10-410, Annotated Code of Maryland, the Commissioner may suspend or revoke a license if a licensed public adjuster is found to have knowingly:
(1)
Falsified a certification of course completion; or
(2)
Submitted a falsified certification of course completion.
Regulation .07 Approval of Courses.LinkCopy Citation
A.
A continuing education course shall be submitted to the Commissioner for approval. The Commissioner may approve a course only if the course imparts substantive and procedural knowledge relating to the insurance field.
B.
The Commissioner may not approve a course covering any of the following subject areas:
(1)
A course in office or business skills, including typing, speed reading, or the use of computers, calculators, or other machines or equipment;
(2)
A course in office management, client relations, or other matters aimed at improving the operating of the person’s business; or
(3)
A course in salesmanship or product promotion, stress management, time management, psychology, motivation, or written or oral communications.
C.
Except for a self-study course, a course submitted to the Commissioner for approval does not need to require a textbook or an examination in order to receive approval.
D.
The Commissioner shall assign to each approved course:
(1)
The number of hours of continuing education that an individual taking the course may receive for successful completion of the course;
(2)
A designated course number that is provided on all certificates of course completion, all correspondence relating to the course, and on all forms filed with the Commissioner relating to the course;
(3)
A designation of “Public Adjuster”, “Property/Casualty” or “Ethics”; and
(4)
A course expiration date.
Regulation .08 Submission of Courses for Approval.LinkCopy Citation
A.
A provider shall submit to the Commissioner:
(1)
A fully completed course approval package consisting of the following forms provided by the Commissioner:
(a)
Request for approval of continuing education course;
(b)
Course coordinator information;
(c)
Course instructor information and approval form;
(d)
Certificate of course completion; and
(e)
Checklist of items that must accompany the course approval package;
(2)
A statement of the educational objectives;
(3)
A full and detailed description of the course content including the amount of time allotted to each subject covered by the course on an hour-by-hour basis;
(4)
All course materials, including textbooks, written materials in place of textbooks, course syllabus, policy forms, and any other items used by the instructor;
(5)
Promotional materials; and
(6)
A statement of the refund policy, which shall include:
(a)
Full refund of course fees due to cancellation by the sponsor; and
(b)
The refund policy when the licensed insurance producer:
(i)
Withdraws from the course before commencement; and
(ii)
Fails to complete the course after it has commenced.
B.
The provider shall submit a course approval package to the Commissioner as follows:
(1)
A course previously approved in another state or jurisdiction that has adopted the “NAIC Uniform Declaration Regarding Continuing Education Reciprocity Course Approval Guidelines” shall be submitted using the NAIC Uniform Continuing Education Reciprocity Course Filing Form at least 30 days before the first date on which the course is to be taught; or
(2)
A course that has not been previously approved in a state that has adopted the “NAIC Uniform Declaration Regarding Continuing Education Reciprocity Course Approval Guidelines” shall be submitted at least 45 days before the first date on which the course is to be taught.
C.
The Commissioner shall notify the provider in writing of a course approval and the period of time of the approval, which shall be from the date of the approval until the second anniversary of the date the course was approved.
D.
A provider may offer only a course approved by the Commissioner.
Regulation .09 Submission of Courses for Renewal.LinkCopy Citation
A.
At least 90 days prior to the expiration of a course’s approval, the Commissioner shall mail to the provider of the approved course a notice that states:
(1)
The course name, the course content code, the course number, and the date on which the course approval expires;
(2)
The date by which the Commissioner must receive the request to renew; and
(3)
The fee charged for reviewing continuing education courses submitted for renewal.
B.
In order to renew a course, a provider shall comply with the provisions of Regulation .08 of this chapter.
Regulation .10 Providers.LinkCopy Citation
A.
A provider shall:
(1)
Comply with this chapter for each of the provider’s approved courses;
(2)
Use in all communication with the Commissioner or the Commissioner’s designee the provider identification number assigned by the Commissioner;
(3)
Use a course coordinator who meets the qualifications specified in Regulation .11 of this chapter;
(4)
Use an approved instructor; and
(5)
Notify the Commissioner of the replacement of a course coordinator.
B.
A provider who is an insurer authorized to do business in Maryland may not require an appointed insurance producer to obtain hours of continuing education by attending an approved course that the insurer is providing.
C.
Within 15 days of the completion of a course, the provider shall submit a course completion roster to the Commissioner or the Commissioner’s designee in an electronic format specified by the Commissioner.
Regulation .11 Course Coordinators.LinkCopy Citation
A.
The provider shall ensure that each approved continuing education course has at least one course coordinator who is responsible for:
(1)
Supervising the administration of the course; and
(2)
Compliance with this chapter.
B.
A course coordinator shall possess one or more of the following qualifications:
(1)
A minimum of 5 years experience as an actively licensed public adjuster;
(2)
A minimum of 3 years experience as an administrator of an education program;
(3)
A degree in education and at least 2 years experience as a licensed public adjuster; or
(4)
Full-time employment in the insurance education field as a coordinator with at least 6 months experience.
C.
A course coordinator shall:
(1)
Assure compliance with this chapter;
(2)
Notify the Commissioner of:
(a)
Any change in the instructor for an approved course;
(b)
The date, time, and location of a course offering and the name of the instructor not less than 14 calendar days in advance of the date that the course offering is scheduled to begin; and
(c)
The cancellation of a course offering as soon as reasonably possible;
(3)
Assure that students are provided with current and accurate information;
(4)
Create an accurate record of student attendance and successful course completion for each offering of an approved course;
(5)
Supervise and evaluate courses and instructors;
(6)
Investigate complaints relating to course offerings and instructors;
(7)
Maintain accurate records relating to course offerings, instructors, student attendance, and student course completion for a minimum of 4 years following the date of the course offering; and
(8)
Within 15 days of the student’s completion of the course, provide each student with a certificate of course completion on a form approved by the Commissioner.
Regulation .12 Instructors.LinkCopy Citation
A.
The provider shall ensure that each continuing education course approved by the Commissioner is taught by an instructor who has been approved by the Commissioner as meeting the qualifications specified in this chapter.
B.
The provider shall submit to the Commissioner a course instructor information and approval form for each instructor of an approved course.
C.
An instructor shall possess one or more of the following qualifications:
(1)
A minimum of 2 years experience in the subject matter being taught;
(2)
A degree in the subject matter being taught; or
(3)
A minimum of 2 years recent experiences as a licensed public adjuster and a minimum of 6 months practical experience in the subject matter being taught.
D.
The Commissioner may not approve as an instructor a licensed public adjuster:
(1)
Who has been fined; or
(2)
Whose license has been suspended or revoked.
E.
An instructor shall:
(1)
Comply with the requirements of this chapter; and
(2)
Provide students with:
(a)
Current and accurate information on the subject matter of the course; and
(b)
A course syllabus that shall contain at least the following information:
(i)
Course title and designated course number assigned by the Commissioner;
(ii)
Times and dates of the course offering;
(iii)
Names, addresses, and telephone numbers of each course coordinator; and
(iv)
Detailed outline of the subject matter of the course.
F.
The Commissioner may revoke the approval of any course that is not taught by an approved instructor.
Regulation .13 Advertising of Approved Courses.LinkCopy Citation
A.
Except as provided in §D of this regulation, a provider may not advertise or distribute promotional materials unless the course has been approved by the Commissioner.
B.
Advertisements and promotional materials may not be deceptive or misleading and shall, at a minimum, clearly identify the number of hours of continuing education for which a course has been approved and the fee for taking the course.
C.
A provider of an approved course who advertises or promotes a course that has not been approved or a course that is not eligible for approval shall prominently state that no hours of continuing education can be earned by taking the course.
D.
A provider may request, in writing, permission to advertise a course before approval is obtained from the Commissioner by submitting:
(1)
A letter specifically requesting permission to advertise the course before approval is obtained; and
(2)
With the course approval package, all advertisements or promotional materials that will be used before approval and which shall prominently include the words “approval from the Insurance Administration pending”.
E.
The Commissioner shall issue the provider a written response either granting or denying the provider’s request for course approval. The provider may not advertise the course until the Commissioner has granted the request.
Regulation .14 Prohibited Practices.LinkCopy Citation
The following practices by a provider, course coordinator, or instructor are prohibited:
A.
Offering or teaching a course that is not approved or that is not in substantial conformity with the course completion package submitted to and approved by the Commissioner;
B.
Promoting a particular public adjuster, insurance agency or insurance company or products of the agency or company; and
C.
Requiring, as a condition of receiving a certificate of course completion, that students participate in other programs or services offered by the provider, course coordinator, or instructor.
Regulation .15 Powers of the Commissioner.LinkCopy Citation
A.
The Commissioner, or the Commissioner’s designee, may audit all course offerings with or without notice to the provider, course coordinator, or instructor of the course.
B.
The Commissioner may suspend or revoke the approval of a course for any of the following violations of this chapter:
(1)
Failure of the instructor to follow the approved course content;
(2)
Failure to use a course coordinator meeting the qualifications specified in this chapter;
(3)
Failure to use an approved instructor;
(4)
Failure to notify the Commissioner of the date, time, location, and instructor of a course offering in accordance with Regulation .11C(2)(b) of this chapter; or
(5)
Failure to submit a course completion roster in accordance with Regulation .10C of this chapter.
C.
The Commissioner may suspend or revoke all approved courses of a particular provider for a violation of this chapter or refuse to approve a course submitted by a specific provider if the Commissioner determines that a past course offering by that provider was not in compliance with this chapter.
D.
The Commissioner may suspend or revoke the approval of any instructor, course coordinator, or course provider who fails to comply with this chapter.
Regulation .16 Waiver of the Continuing Education Requirement.LinkCopy Citation
A.
Subject to §B of this regulation, the continuing education requirements may be waived for a licensed insurance producer who:
(1)
Submits a written request for a waiver; and
(2)
Is determined by the Commissioner, in the Commissioner’s discretion, to warrant a waiver.
B.
A waiver request shall be accompanied by supporting documentation.
Regulation .17 Protections after Loss or Damage to Property.LinkCopy Citation
A.
The term “business day”, as it is used in Insurance Article, §§10–411(h) and 10-414(f), Annotated Code of Maryland means any day other than a Saturday, Sunday, or State holiday.
B.
In enforcing Insurance Article, §10-414(f), Annotated Code of Maryland, the Commissioner shall determine the date of a loss giving rise to an insurance claim as follows:
(1)
If the insurance claim resulted from a hurricane, then the date of loss giving rise to the insurance claim is the date that the hurricane made landfall in the State of Maryland;
(2)
If the insurance claim resulted from a tornado, windstorm, severe rain, or other weather-related event that is not a hurricane, then the date of loss giving rise to the insurance claim is the date that the tornado, windstorm, severe rain, or other weather-related event is verified to have occurred in Maryland by the National Oceanic and Atmospheric Administration; or
(3)
If the insurance claim is not within the scope of §B(1) or (2) of this regulation, then the date of loss giving rise to the insurance claim is the date that the loss was discovered.
C.
To comply with §10-414(f), a public adjuster who enters into a contract for public adjuster services during or within 72 hours after a loss giving rise to an insurance claim shall electronically submit the Public Adjuster Contract Submission Form that is published to the Administration’s website, together with any attachments required therein, within one business day after entering into the contract.
Chapter 19. Managing General Agents
Regulation .01 Bond and Errors and Omissions Coverage Requirement.LinkCopy Citation
A.
A managing general agent shall obtain and maintain:
(1)
A fidelity bond for the protection of the insurer and policyholder equal to or greater than 10 percent of the maximum annual premium volume as stated in the underwriting guidelines in the contract required by Insurance Article, §8-209, Annotated Code of Maryland, but no less than $100,000; and
(2)
An errors and omissions policy for the protection of the insurer and policyholder with limits of at least $1,000,000.
B.
A managing general agent shall provide evidence of bond and errors and omissions coverage on the initial or renewal application.