S 327 Session 110 (1993-1994)
S 0327 General Bill, By L.E. Richter, Mescher, Passailaigue and M.T. Rose
A Bill to amend Chapter 3, Title 38, Code of Laws of South Carolina, 1976,
relating to the Insurance Commission and the Department of Insurance so as to
abolish the Insurance Commission and to provide that commencing in 1994 the
Insurance Commissioner must be elected by the qualified electors of the State;
to provide for his term, qualifications, and for the filling of a vacancy; to
change references in this Chapter relating to the Insurance Commissioner; to
delete general provisions relating to the Insurance Commission; to delete
provisions relating to the Insurance Advisory Committee; and to provide that
the Code Commissioner change certain references in the 1976 Code of Laws.
01/28/93 Senate Introduced and read first time SJ-5
01/28/93 Senate Referred to Committee on Banking and Insurance SJ-5
A BILL
TO AMEND CHAPTER 3, TITLE 38, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO THE INSURANCE
COMMISSION AND THE DEPARTMENT OF INSURANCE SO AS
TO ABOLISH THE INSURANCE COMMISSION AND TO PROVIDE
THAT COMMENCING IN 1994 THE INSURANCE
COMMISSIONER MUST BE ELECTED BY THE QUALIFIED
ELECTORS OF THE STATE; TO PROVIDE FOR HIS TERM,
QUALIFICATIONS, AND FOR THE FILLING OF A VACANCY; TO
CHANGE REFERENCES IN THIS CHAPTER RELATING TO THE
INSURANCE COMMISSIONER; TO DELETE GENERAL
PROVISIONS RELATING TO THE INSURANCE COMMISSION;
TO DELETE PROVISIONS RELATING TO THE INSURANCE
ADVISORY COMMITTEE; AND TO PROVIDE THAT THE CODE
COMMISSIONER CHANGE CERTAIN REFERENCES IN THE 1976
CODE OF LAWS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 3, Title 38 of the 1976 Code is amended to read:
"Section 38-3-10. There is established a separate and distinct
department of this State, known as the Department of Insurance,
which is the administrative arm of the Insurance Commission.
Section 38-3-20. Beginning on July 1, 1980, the Insurance
Commission is composed of seven members, one being selected from
each congressional district and one from the State at large, who must be
appointed by the Governor, with the advice and consent of the Senate.
Two must be appointed for a term of two years, two must be appointed
for a term of four years, and three must be appointed for a term of six
years. Thereafter, the terms are for six years and all members of the
Commission shall serve until their successors are appointed and qualify.
No member appointed may have past or present employment in the
insurance industry during the four years immediately preceding his
appointment but must be selected from the general public based upon
demonstrated objectivity, independence, and service in matters of public
concern. No members of the Commission may serve more than one term.
Any vacancy in office must be filled by the Governor by appointment.
(A) Commencing in 1994 and every four years thereafter, the
qualified electors of the State must elect in the general election an
Insurance Commissioner who must serve for a term of four years,
coterminous with that of the Governor. He may succeed himself in the
office.
(B) The Insurance Commissioner must be at least thirty years of age.
He may not hold any other public office while serving as Insurance
Commissioner but shall devote all of his working time to the duties of
his office as provided by law. Before taking the oath of office he shall
sever all connections, either direct or indirect, except as a policyholder,
with any insurance company or agency and shall maintain the severance
during his tenure of office. If he becomes a candidate for any other
public office or becomes a member of a political committee during
tenure, his office as Insurance Commissioner must be vacated
immediately.
(C) In case any vacancy shall occur in the office of Insurance
Commissioner by death, resignation, or otherwise, the vacancy thereby
created shall be filled by the Governor, by and with the advice and
consent of the Senate, for the unexpired portion of the term.
(D) The Insurance Commissioner, if any, serving on the effective
date of this act shall continue to serve until his successor is elected and
qualifies pursuant to the provisions of this section.
Section 38-3-30. Each member of the Commission shall,
before entering upon or continuing to discharge the duties of his office,
give bond to the State in the sum of twenty-five thousand dollars with
a sufficient surety, to be approved by the State Treasurer, for the faithful
performance of all duties required of him under the law during the term
of his office. The premium of the bond must be paid by the State.
Section 38-3-40. The Insurance Commissioner
Commission members shall receive annual such
compensation as may be provided by the General Assembly and
official expenses as provided by law for members of state boards,
committees, and commissions as established under the
provisions of Section 8-11-160 and for which funds have been
authorized in the general appropriation act.
Section 38-3-50. Annually the Commission shall organize itself
by electing one of its number as chairman and any other officer it
considers necessary. The Commission shall meet as often as necessary
for the discharge of its business and shall meet upon the call of the
chairman or a majority of the members. The majority of the members
constitutes a quorum.
Section 38-3-60. The Commission Insurance
Commissioner shall select and employ a Chief Insurance
Commissioner and shall issue to him general policies and
broad objectives regarding the operation of the insurance industry in this
State. The Commission and shall review, amend, and
supplement these policies and objectives as it he sees
fit, shall require the Chief Insurance Commissioner to pursue
forcefully the policies and objectives but shall leave to the Chief
Insurance Commissioner the task of developing and implementing
specific plans, programs, and techniques necessary to further the
Commission's policies and objectives.
Section 38-3-70. The Commission Insurance
Commissioner shall annually submit to the General Assembly,
through the Governor, a report of its his official acts and
doings, together with a report of all insurers under the
Commission Department of Insurance doing business
in this State, with condensed statements of their reports made to it,
together with a statement of all licenses, taxes, and fees received by it
through insurers and paid by it to the State Treasurer. The
Commission Insurance Commissioner shall report to the
General Assembly any change which in its his opinion
should be made in the laws relating to insurance and other subjects
pertaining to the Commission. By February first of each
year, it he shall make to the Governor the
recommendations called for in this section, to be transmitted to the
General Assembly with its last the most recent Department
of Insurance annual report, including a statement of its receipts and
disbursements.
Section 38-3-80. The Commission Insurance
Commissioner shall have a adopt an official seal
with a suitable inscription, an impression of which must be filed with the
Secretary of State.
Section 38-3-90. The Governor, with the advice and consent of
the Senate, shall appoint an advisory committee of five residents of this
State to advise and consult with the Commission concerning the policies
formulated by the Commission and the operation and administration of
this title. The advisory committee consists of the following competing
segments of the insurance industry: one member from the life insurance
field; one member from the accident and health field; one member from
the property and casualty field; one member who is an agent primarily
engaged in the life and accident and health insurance field; and one
member who is an agent primarily engaged in the property and casualty
field. The advisory committee may be in attendance at each public
meeting of the Commission but must have at least one member in
attendance at each public meeting. The advisory committee may not
attend executive sessions of the Commission. The advisory committee
members shall serve a period coterminous with the term of the
Governor. The members of the advisory committee may receive no
compensation, mileage, subsistence, or per diem for their services. Any
vacancy in office must be filled by the Governor by appointment.
Section 38-3-100. The Commission shall select the
Commissioner and may remove or discharge him for good cause. The
Commissioner is not subject to the State Employee Grievance
Committee or any internal grievance procedure established at the
Insurance Department. His term of employment is for four years, unless
earlier terminated for good cause, and he is eligible for reemployment.
He shall receive an annual salary as provided by law. The
Commissioner must be hired with special reference to his training,
experience, technical knowledge of the insurance industry, and
demonstrated administrative ability. He must be at least thirty years of
age. He may hold no other public office while serving as Commissioner
but shall devote all of his working time to the duties of his office.
Before taking the oath of office he shall sever all connections, either
direct or indirect, except as a policyholder, with any insurance company
or agency and shall maintain the severance during his tenure of office.
No person who has been a Commission member may serve as
Commissioner. If he becomes a candidate for public office or becomes
a member of a political committee during tenure, his office as
Commissioner must be immediately vacated.
Section 38-3-110. The Chief Insurance Commissioner has
the following duties:
(1) supervise and regulate the rates and service of every insurer in
this State and fix just and reasonable standards, classifications,
regulations, practices, and measurements of service to be observed and
followed by every insurer doing business in this State. Nothing
contained in this title authorizes or requires a review by the
Insurance Commissioner Commission of any order
of the Commissioner under the Administrative Procedures Act.
This item does not grant any additional authority to the Commissioner
with regard to insurance rates other than the rate-making authority
specifically granted to the Commissioner, the Commission, or the
Department of Insurance for certain kinds of insurance in other
provisions of this title;
(2) see that all laws of this State governing insurers or relating to the
business of insurance are faithfully executed and make regulations to
carry out this title and all other insurance laws of this State, the
enforcement or administration of which is not otherwise specifically
provided for;
(3) furnish to domestic insurers required by law to report to the
Department the necessary blank forms for the reports required,
which forms may be changed as necessary to secure full information as
to the standing, condition, and any other information desired by the
Commissioner;
(4) report to the Attorney General or other appropriate law
enforcement officials criminal violations of the laws relative to the
business of insurance or the provisions of this title which he considers
necessary to report; and
(5) institute civil actions, either through his office or through the
Attorney General, relative to the business of insurance or the provisions
of this title which he considers necessary to institute.
Section 38-3-120. The Commissioner shall take the oath of office
as prescribed for all state officers. Before entering upon or continuing
the discharge of the duties of his office, he shall give bond to the State
for the benefit of any person aggrieved by his unlawful or wrongful
actions. This bond must be in the sum of fifty thousand dollars, with
sufficient surety, to be approved by the State Treasurer, for the faithful
performance of all the duties required of him under the law during the
term of his office. The premium of the bond must be paid by the
State.
Section 38-3-130. The Insurance Commissioner shall
appoint or employ actuaries, examiners, clerks, and other employees
necessary for the proper execution of the work of the
Commission commission.
Section 38-3-140. The failure to do any act required by this title is
considered a violation committed in part at the office of the
Commissioner commissioner in Columbia.
Section 38-3-150. All examinations or investigations provided by
this title, unless otherwise provided by any other insurance laws of this
State, may be conducted by the Insurance Commissioner or by
one or more of his duly authorized assistants or agents. All hearings
must be held by the Insurance Commissioner or by one of his
duly authorized assistants or agents when authorized to do so in writing
by the Insurance Commissioner. However, in any hearing
concerning the adjustment of insurance rates only the Chief
Insurance Commissioner or the Deputy Chief Insurance
Commissioner may conduct the hearing.
Section 38-3-160. The Insurance Commissioner or his duly
appointed assistants or agents shall administer all oaths required in the
discharge of his official duties and may also administer oaths and
affirmations to persons appearing as witnesses before them, and false
testimony in any matter or proceeding is considered perjury and must be
punished in accordance with the laws of this State.
Section 38-3-170. All hearings, unless otherwise specifically
provided, must be held at the time and place designated in a written
notice given by the Insurance Commissioner to the person cited
to appear at least thirty days before the designated date. The notice shall
state the subject of the inquiry and specific charges, if any. It is
sufficient to give notice either by delivering it to the person or by
depositing it in the United States mail, postage prepaid, addressed to the
last known address of the person and registered with return receipt
requested.
Section 38-3-180. The Insurance Commissioner or any
assistants or agents appointed to conduct examinations may summon and
compel the attendance of witnesses to testify in relation to any matter
which is, by the provisions of this title or by any other insurance laws of
this State, a subject of inquiry and investigation. The Insurance
Commissioner has the power of a circuit judge to punish for contempt
any witness failing to answer any summons or failing or refusing to
testify when so required. The Commissioner or any assistants or
agents appointed to conduct examinations may also administer oaths and
affirmations to persons appearing as witnesses before them, and false
testimony in any matter or proceeding is considered perjury and must be
punished in accordance with the laws of this State.
Section 38-3-190. Any person summoned by the Insurance
Department to testify as a witness at any hearing must be paid for his
actual mileage at the same rate as provided by law for state boards,
committees, and commissions.
Section 38-3-200. No order of the Insurance Commissioner
is effective unless made in writing and signed by the Commissioner or
by his authority.
Section 38-3-210. Any order or decision made, issued, or executed
by the commissioner Insurance Commissioner or his
assistants or agents is subject to judicial review in accordance with the
appellate procedures of Sections 1-23-380 and 1-23-390. An appeal
from an order or decision under this section must be heard in the Court
of Common Pleas of Richland County. However, an appeal may be
brought in any county and subsequently transferred to Richland County.
Notwithstanding the provisions of Section 1-23-380(c), the circuit court
may not, under any terms, order a stay of enforcement of any order of
the commissioner to make good an impairment of capital or surplus or
a deficiency in the amount of admitted assets.
Section 38-3-220. Every certificate or other paper executed by the
Insurance Commissioner in pursuance of any authority
conferred upon him by law and sealed with the seal of the
Commission commission and all copies of papers
certified by the Insurance Commissioner and authenticated by
the Commission's department's seal may in all cases be
used as evidence in any suit or proceeding in any court of this State with
the same force and effect as the originals.
Section 38-3-230. In any case or controversy where it is necessary
to determine whether any insurance or other company, or agent thereof,
is or has been licensed by the Insurance Commissioner to do
business in this State, the certificate of the Commissioner
commissioner under the seal of the Commission
department is admissible in evidence as proof of this authority.
Section 38-3-240. (A) Beginning July 1, 1992, the
The Insurance Commissioner of South Carolina shall begin
converting certain licenses required by statute or regulation to a biennial
license fee collection period. These license fees must be collected as
follows:
(1) All insurers transacting business in this State including
reciprocals, fraternal benefit associations, mutual insurers doing a
property business only in no more than three counties, mutual insurers
doing a property business only in a single county, and approved
reinsurers shall pay a license fee for two years to the
commissioner Insurance Commissioner by March 1,
1994, and every two years after that time by March 1st
first every even-numbered year.
(2) An agency transacting the business of insurance in this State
shall pay a license fee for two years to the commissioner within thirty
days after January 1, 1994, and every two years after that time within
thirty days after January 1st first every even-numbered
year.
(3) A broker transacting the business of insurance in this State
shall pay a license fee for two years to the commissioner within thirty
days after May 1, 1994, and every two years after that time within thirty
days after May 1st first every even-numbered year.
(4) An adjuster transacting business in this State shall pay a
license fee for two years to the commissioner within thirty days after
August 1, 1993, and every two years after that time within thirty days
after August 1st first every odd-numbered year.
(5) A motor vehicle damage appraiser transacting business in this
State shall pay a license fee for two years to the commissioner within
thirty days after October 1, 1993, and every two years after that time
within thirty days after October 1st first every odd-numbered year.
(6) An agent transacting the business of insurance in this State
shall pay a license fee for two years to the commissioner within thirty
days after September 1, 1992, and every two years after that time within
thirty days after July 1st first every even-numbered
year.
(B) The fees described in this section must be earned fully when paid
and are not refundable, proratable, or transferable. They must be
collected in the amount and manner prescribed by statute or regulation
before July 1, 1992, until the dates prescribed in subsection (A) when
collections must be made pursuant to that subsection.
SECTION 2. Wherever the term Commission or Insurance
Commission appears in the Acts and Joint Resolutions of the General
Assembly or the 1976 Code of Laws of South Carolina, it shall mean
Insurance Commissioner. The Code Commissioner is directed to change
all references at such time and in such a manner as may be timely and
cost effective.
SECTION 3. This act takes effect upon approval by the Governor.
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