Appointments and TerminationsAppointments are required of those producers or business entities who are acting in the capacity of an "agent of the insurer." Electronic notification of appointment/termination will be sent to the business partner submitting the information. An agent of the insurer is any insurance producer who is compensated directly or indirectly by an insurer and sells, solicits or negotiates any insurance product of that insurer. An agent of the insurer must hold an appointment with that insurer. An agent of the insured is any insurance producer or person who secures compensation from an insured or insurance customer only and receives no compensation directly or indirectly from an insurer for a transaction with that insured or insurance customer. An agent of the insured is not required to hold an appointment with the insurer with which coverage is placed on behalf of the insured. An insurer must appoint a producer or business entity as its agent within fifteen (15) days from the date the agency contract is executed, or the first insurance application is submitted to the insurance company by the producer or business entity. The termination of a producer's final appointment will not terminate that producer's license. The producer may not act as an agent of an insurer until he/she is appointed by that insurer. Appointments become effective the day they are processed by the Division. All appointments are renewed on an annual basis. The division processes all appointments and terminations through March 31 of each year. Each insurer is provided with a list of all appointed producers along with a billing statement which is due back to the Division of Insurance by April 30 or appointments will terminate. New and renewal appointment fees are $10 for resident producers and $20 for non-resident producers. Appointments may be terminated by electronic appointment termination through the National Association of Insurance Commissioners (NAIC) Producer Information Network (PIN) or Sircon (Vertafore). Insurers must provide the Division with a reason for the termination. Insurers are required to notify the producer within fifteen (15) days of the date a notice of appointment termination is sent to the Division of Insurance. return to Topics list Contact the Division of Insurance An insurer may cancel a producer appointment "for cause" by notifying the commissioner in writing of the termination within 30 days following the effective date. The termination must be one or more of the reasons listed in Section 1239 of the Michigan Insurance Code, MCL 500.1239, or the insurer has knowledge that the producer was found by a legal regulatory agency or organization (court, government, self-regulatory organization) to have engaged in any of the activities listed in this section of the code. Information reported by the insurer will be absent of malice. If malice is determined by a court, after a notice of hearing, the commissioner may take regulatory action to suspend, revoke and/or fine the insurer. Within 15 days after notification to the commissioner, the insurer will notify the producer by certified mail, return receipt, or by overnight delivery service. All mailing costs are pre-paid by the insurer. Within 30 days, the producer may simultaneously file written comments with the commissioner and the insurer, concerning the termination notification. All information submitted by the insurer will become part of the producer's file held by the commissioner; upon request, the insurer will submit additional written documentation pertaining to the termination. All documentation must be clearly stamped "confidential", and is not subject to the Freedom of Information Act, subpoena, discovery, or admissible in evidence in any private civil action. The commissioner is authorized to use the submitted information in the furtherance of any regulatory action, and may share the information with the NAIC via the NIPR gateway and PDB, and other regulatory agencies upon agreement that the information will remain confidential. No waiver of privilege or confidentiality will be signed by the commissioner upon disclosure due to receipt of the information or other documents. A termination for cause will appear on the Insurance Licensee Locator as a cancellation of appointment. § 38.2-1834.1. Notification to Commission of termination; notice to agent; immunities; confidentiality; penalties.A. An insurer or authorized representative of the insurer that terminates the appointment, employment, contract or other insurance business relationship with an agent or other licensee under this chapter shall notify the Commission within thirty calendar days following the effective date of the termination, using a format prescribed by the Commission, if the reason for termination is one of the reasons set forth in § 38.2-1831 or the insurer has knowledge the agent was found by a court, government body, or legally authorized self-regulatory organization authorized by law to have engaged in any of the activities in § 38.2-1356, 38.2-1363, 38.2-1831 or 38.2-1843. The propriety of any such termination for cause shall be certified in writing by an officer or authorized representative of the insurer or agent terminating the relationship. Upon the written request of the Commission, the insurer shall provide additional information, documents, records or other data pertaining to the termination or activity of the agent or other licensee. B. The insurer or the authorized representative of the insurer shall promptly notify the Commission in a format acceptable to the Commission if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the Commission in accordance with subsection A had the insurer then known of its existence. C. 1. Within fifteen calendar days after making the notification required by subsections A and B, the insurer shall mail a copy of the notification to the agent at his last known address pursuant to the insurer's records. If the agent is terminated for cause for any of the reasons listed in § 38.2-1831, the insurer shall provide a copy of the notification to the agent at his last known address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier. 2. Within thirty calendar days after the agent has received the original or additional notification, the agent may file written comments concerning the substance of the notification with the Commission in the form and manner required by the Commission. The agent shall, by the same means, simultaneously send a copy of the comments to the reporting insurer, and the comments shall become a part of the Commission's file and accompany every copy of a report distributed or disclosed for any reason about the agent as permitted under subsection D. D. 1. In the absence of actual malice, an insurer, the authorized representative of the insurer, a producer, the Commission, authorized representatives of the Commission, the NAIC, its affiliates or subsidiaries, or state, federal, and international law-enforcement authorities shall not be subject to civil liability, and a civil cause of action of any nature shall not arise against these entities or their respective agents or employees, as a result of any statement or information required by or provided pursuant to this section or any information relating to any statement that may be requested in writing by the Commission, from an insurer or agent, or a statement by a terminating insurer or agent to an insurer or agent limited solely and exclusively to whether a termination for cause under subsection A was reported to the Commission, provided that the propriety of any termination for cause under subsection A is certified in writing, pursuant to subsection A of this section, by an officer or authorized representative of the insurer or agent terminating the relationship. 2. In any action brought against a person that may have immunity under subdivision 1 for making any statement required by this section or providing any information relating to any statement that may be requested by the Commission, the party bringing the action shall plead specifically in any allegation that subdivision 1 does not apply because the person making the statement or providing the information did so with actual malice. 3. Subdivision 1 or 2 shall not abrogate or modify any existing statutory or common law privileges or immunities. E. 1. Any documents, materials or other information in the control or possession of the Commission that is furnished by an insurer, agent or an employee thereof acting on behalf of the insurer or agent, or obtained by the Commission in an investigation pursuant to this chapter shall be confidential by law and privileged, shall not be subject to inspection or review by the general public, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action. However, the Commission is authorized to use the documents, materials or other information in the furtherance of any regulatory or legal action brought as a part of the Commission's duties. 2. Neither the Commission nor any person who received documents, materials or other information while acting under the authority of the Commission shall be permitted or required to testify in any private civil action concerning any confidential documents, materials, or information subject to subdivision 1. 3. In order to assist in the performance of the Commission's duties under this chapter, the Commission: a. May share documents, material or other information, including the confidential and privileged documents, materials or information subject to subdivision 1, with other state, federal, and international regulatory agencies, with the NAIC, its affiliates or subsidiaries, and with local, state, federal, and international law-enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material or other information. b. May receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the NAIC, its affiliates or subsidiaries and from regulatory and law-enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information. 4. No waiver of any applicable privilege or claim of confidentiality in the documents, materials, or information shall occur as a result of disclosure to the Commission under this section or as a result of sharing as authorized in subdivision 3. 5. Nothing in this chapter shall prohibit the Commission from releasing final, adjudicated actions including for cause terminations that are open to public inspection pursuant to Chapter 4 (§ 12.1-18 et seq.) of Title 12.1 to a database or other clearinghouse service maintained by the NAIC, its affiliates or subsidiaries of the NAIC. F. An insurer, the authorized representative of the insurer, or agent that fails to report as required under the provisions of this section or that is found to have reported with actual malice by a court of competent jurisdiction may, after notice and an opportunity to be heard, have its license or certificate of authority suspended or revoked and may be fined in accordance with Chapter 2 (§ 38.2-200 et seq.) of this title. 2001, c. 706; 2002, c. 296; 2008, c. 303. |
How much time does an insurer have to notify the commissioner after an agents appointment is terminated?
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