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H. 3491
STATUS INFORMATION
General Bill
Sponsors: Reps. Cato, E.H. Pitts and Tripp
Document Path: l:\council\bills\dka\3060dw05.doc
Introduced in the House on February 9, 2005
Currently residing in the House Committee on Labor, Commerce and Industry
Summary: Criteria for licensing insurance adjusters
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
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2/9/2005 House Introduced and read first time HJ-6
2/9/2005 House Referred to Committee on Labor, Commerce and Industry
HJ-6
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO AMEND CHAPTER 47, TITLE 38, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO INSURANCE ADJUSTERS, SO AS TO CHANGE THE CRITERIA FOR LICENSING ADJUSTERS, REQUIRE ADDITIONAL INFORMATION BEFORE A LICENSE IS ISSUED, PROVIDE FOR THE FEE AND DURATION OF THE LICENSE, REQUIRE CONTINUING EDUCATION REQUIREMENT FOR ADJUSTERS, PROVIDE FOR THE PROBATION, REVOCATION, OR SUSPENSION OF AN ADJUSTERS LICENSE, AND PROVIDE FOR PENALTIES FOR VIOLATIONS OF REGULATIONS PROMULGATED PURSUANT TO THE PROVISIONS OF TITLE 38 OR LAWS IN TITLE 38 AFFECTING ADJUSTERS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 47, Title 38 of the 1976 Code is amended to read:
Section 38-47-10. (A) Every Each individual commonly called an 'adjuster', adjusting losses for an insurer licensed to do business in this State who determines the extent of insured losses and assists in settling or attempts to settle claims on behalf of an admitted or approved insurer, must be licensed by the director or his designee, and declare under penalty of refusal, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of the individual's knowledge and belief. These individuals shall apply for a license on a form prescribed by the director or his designee. The director or his designee shall satisfy himself that each applicant for an adjuster's license is an individual of good moral character, has sufficient knowledge of the insurance business and his duties as an adjuster, has not violated the insurance laws of the State, and is a fit and proper individual for the position. No A license may not be issued to a nonresident adjuster who resides in a state refusing to license a South Carolina adjusters adjuster.
(B)(1) Before approving an application, the director or his designee shall find that the individual:
(a) is at least eighteen years of age;
(b) has not committed any act that is a ground for denial, suspension, or revocation pursuant to Section 38-47-80;
(c) has paid the fees pursuant to Section 38-47-30; and
(d) has successfully passed the examination or examinations for the line or lines of insurance for which the person has applied. The director or his designee may waive the examination with respect to an applicant who has achieved the designation of Chartered Property Casualty Underwriter (CPCU), Certified Insurance Consultant (CIC).
(2) The director or his designee may require any document necessary to verify the information contained in an application.
(C) Agents An agent licensed under pursuant to Chapter 43 are is not required to comply with this section.
(D) A nonlicensed individual entering the State for the purpose of adjusting claims on behalf of a licensed or approved insurer in response to a catastrophic event, must be approved by the director or his designee. As determined by the director, an administrative fee may be charged and retained by the department for administration of each catastrophic event.
Section 38-47-15. When If an individual applies for an adjuster's license he shall supply the department his business mailing and residence address. The adjuster shall notify the department within thirty days of any change in these addresses. Failure to inform the director or his designee of a change in legal name or address within this period shall result in a penalty pursuant to Section 38-2-10.
Section 38-47-20. The director or his designee may enter into reciprocal agreements with the insurance commissioners of other states in regard to licensing of a nonresident adjusters adjuster if in his judgment such the arrangements or agreements are in the best interest of the State and if the applicant for an adjuster's license meets the minimum statutory requirements of this State for the issuance of a license. However, notwithstanding the provisions of Section 38-47-10, the director or his designee may not enter into or continue any reciprocal agreement unless the other state is just as liberal as this State in licensing a nonresident adjusters adjuster.
Section 38-47-30. The biennial fee for an adjuster's license, unless changed by an administrative order of the director, is eighty dollars payable in advance and fully earned when received, not refundable, transferable, nor proratable. However, when the laws of another state of the United States require a South Carolina adjusters adjuster to pay a license fee greater than the fee required in this State of a nonresident adjusters adjuster, the nonresident adjuster shall pay an amount equal to the amount of charges imposed by the laws of his state upon an adjusters adjuster of this State.
Section 38-47-40. An adjuster's license is for an indefinite term unless sooner revoked or suspended if the biennial license fee is paid at the time and in the manner which the department provides by regulation and the provisions of Section 38-47-45 have been met. If the license fee for an adjuster is not received when due, the license must be canceled may be suspended. If the license is to be reinstated, an original application must be filed and after suspension, a reinstatement fee equal to the biennial license fee unpaid must be paid in addition to the regular biennial license fee. If compliance for suspension reinstatement is not met within a sixty-day period immediately following the license suspension deadline, the adjuster's license must be canceled and remains canceled until that time as an original application has been filed and the state adjuster licensing examination has been taken and passed with a minimum score of seventy.
Section 38-47-45. (A) A person licensed pursuant to the provisions of this chapter shall comply with the provisions of Section 38-43-106, with certain exceptions:
(1) Licensed adjusters are required to complete biennially a minimum of fourteen hours of continuing insurance education in order to be eligible for licensure for the following two years. At least two of the fourteen required continuing insurance education hours must be in courses involving ethics or professional responsibility, or both.
(2) A licensed adjuster shall provide evidence of his continuing insurance education status and pay a continuing education recordkeeping fee to the continuing education administrator by April first of the biennial compliance year unless granted an extension of time. Beginning March fifteenth of the compliance year, a licensed adjuster may request in writing a sixty-day extension to complete continuing education requirements. The request must be received by the close of business on April first of the compliance year. A licensed adjuster who does not comply with continuing education requirements shall have his license suspended on renewal. In order to reinstate his license, within a sixty day period immediately following the license suspension date, he shall complete three hours of continuing education in addition to the fourteen hours required and pay a reinstatement fee equal to the biennial license fee, in addition to the regular biennial license fee. If continuing education compliance is not met within the sixty-day period immediately following the license suspension date, the adjuster's license must be canceled and remains canceled until that time as the state adjuster licensing examination has been taken and passed with a minimum score of seventy. However, if the reason for license suspension is directly related to nonpayment of the biennial continuing education fee, within the twelve-month period immediately following the license suspension date, the adjuster may reinstate his license by paying a penalty fee, not to exceed one hundred fifty dollars to the department for administrative purposes.
(3) A maximum of six credit hours may be carried forward.
(4) In addition to the representatives on the Continuing Education Advisory Committee, pursuant to Section 38-43-106(C)(2), the director may accept nominations for qualified individuals from the South Carolina Claims Association, the Claims Management Association of South Carolina, insurers that are not members of any trade association, or another individual, group, or professional association.
(5) A nonresident adjuster who successfully satisfied continuing insurance education requirements of his resident state is deemed to have met the continuing education requirements of this section as long as certification is provided to the continuing education administrator. However, a nonresident adjuster whose home state does not have continuing education requirements is required to meet the requirements of this section.
(6) A licensed adjuster with a minimum of twenty years of continuous licensure, or with twenty-five years of active licensure as an adjuster, is only required to take seven hours of continuing education credits biannually.
(B)(1) The director or his designee shall administer these continuing education requirements and shall approve courses of instruction which qualify for these purposes. However, the director may enter into reciprocal agreements with the insurance commissioners of other states regarding the approval of continuing education courses if in his judgment the arrangements or agreements are in the best interest of the State and if the courses submitted meet the minimum statutory requirements of this State for course approval. In administering this program, the department, in its discretion, may promulgate regulations where an adjuster provides to a continuing education administrator established within the department, proof of compliance with continuing education requirements as a condition of license renewal or, in the alternative, contract with an outside service provider to provide recordkeeping services as the continuing education administrator. The costs of the continuing education administrator must be paid from the continuing insurance education fees paid by an adjuster in the manner provided by this section, except that course approval responsibilities may not be designated to the continuing education administrator. The continuing education administrator shall compile and maintain records reflecting the continuing insurance education status of all licensed or qualified adjusters subject to the requirements of this section. The continuing education administrator shall furnish to each adjuster, a report of the continuing insurance education status.
(2) The department may promulgate regulations prescribing the overall parameters of continuing education requirements, and these regulations authorize the director or his designee to recognize product-specific training.
(C) An adjuster's license is for an indefinite term unless revoked or suspended as long as the provisions of Section 38-47-45 are met. A licensed insurance adjuster who is unable to comply with license renewal procedures due to active military service or some other extenuating circumstance such as a long-term medical disability may request a waiver of these requirements.
Section 38-47-50. Adjusters are An adjustor is declared to be acting as the agents an agent for the company or companies represented by them he represents in the adjustment of any loss. An adjuster licensed pursuant to this chapter is prohibited from performing any of the duties described pursuant to Chapter 48, Title 38.
Section 38-47-60. (A) It is unlawful for a person to:
(1) act as adjuster on a contract made other than as authorized by the laws of this State or made by an insurer who is not regularly licensed to do business in this State; or
(2) adjust or aid in the adjustment, either directly or indirectly, of a claim arising under a contract of insurance not authorized by the laws of this State.
(B) A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction, must be fined in the discretion of the court or imprisoned not more than two years, or both.
Section 38-47-70. When If the director or his designee determines after investigation that there has been a violation of this title by an adjuster, upon ten days' notice, he may impose the penalties provided in Section 38-2-10.
Section 38-47-80. (A) The director or his designee may place on probation, revoke, or suspend an adjuster's license after ten days' notice or refuse to issue or reissue a license when an adjuster has been convicted of a crime involving moral turpitude, financial irresponsibility, or has violated the provisions of this title or a regulation promulgated by the department or the insurance department of another state.
(B) For purposes of this section, 'convicted' includes a plea of guilty or a plea of nolo contendere, and the record of conviction, or a copy of it, certified by the clerk of court or by the judge in whose court the conviction occurred is conclusive evidence of the conviction.
(C) Violation of regulations include, but are not limited to:
(1) violating a subpoena or an order of the director or of another state's director or his designee;
(2) obtaining or attempting to obtain a license through misrepresentation or fraud, or improperly using notes or another reference material to complete an examination for an insurance license;
(3) forging another's name to any document related to an insurance transaction;
(4) failing to comply with an administrative or court order imposing a child support obligation; or
(5) failing to pay state or federal income tax or comply with any administrative or court order directing payment of state or federal income tax.
(D) Upon investigation, the director or his designee finds that an adjuster has obtained a license by fraud or misrepresentation, he may revoke or suspend immediately the license. The director or his designee, in an order suspending a license, shall specify the period during which the suspension is to be in effect. The period may not exceed two years. A licensee whose license has been revoked or an applicant who has been refused a license by the director or his designee, may not reapply for a license until a two-year period of time has lapsed from the effective date of the revocation or refusal. If judicial review before the Administrative Law Judge Division for revocation is sought, then the two years applies from the date of a final court order or decree affirming the revocation or suspension.
(E) If, after notice of a hearing before the Administrative Law Judge Division or notice of an opportunity for hearing before the Administrative Law Judge Division, the director or his designee finds that one or more grounds exist for the revocation or suspension of, or the refusal to issue or reissue a license, the director or his designee, in his discretion, instead of revocation, suspension, or refusal, may impose upon the adjuster or applicant an administrative penalty as provided in Section 38-2-10 for each offense.
(F) The director or his designee may allow the adjuster or applicant a reasonable period, not to exceed thirty days, within which to pay to the director or his designee the amount of the penalty imposed. If the adjuster or applicant fails to pay the penalty in its entirety to the director or his designee at his office in Columbia within the period allowed, the license or application stands revoked, suspended, or renewal refused, as the case may be, upon expiration of the period and without any further proceedings.
(G) If the director or his designee fails to renew or denies an application for a license, the director or his designee shall notify the applicant or licensee and advise, in writing, the applicant or licensee of the reason for the denial or nonrenewal of the applicant's or licensee's license. The applicant or licensee may make written demand upon the administrative law judge within thirty days for a hearing before the administrative law judge to determine the reasonableness of the director or his designee's action. The hearing must be held pursuant to the Administrative Procedures Act.
(H) In addition to or instead of any applicable denial, probation, suspension, or revocation of a license, a person violating the provisions of this title, after a hearing, may be subject to an administrative penalty pursuant to the provisions of Section 38-2-10.
(I) The director shall retain the authority to enforce the provisions of and impose any penalty or remedy authorized by this chapter and title against a person who is under investigation for or charged with a violation of this title even if the person's license or registration has been surrendered or has lapsed by operation of law."
SECTION 2. Upon approval by the Governor, the act takes effect April 1, 2007.
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