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DAR File No. 32801

This filing was published in the 08/01/2009, issue, Vol. 2009, No. 15, of the Utah State Bulletin.

Insurance, Administration

R590-141

Individual and Agency License Lapse and Reinstatement Rule

NOTICE OF PROPOSED RULE

DAR File No.: 32801
Filed: 07/07/2009, 01:31
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule sets procedures for the lapse and reinstatement of an individual and agency license. The department wanted the basic licensing requirements in one rule. As a result, this rule is being repealed and replaced with Rule R590-244, Individual and Agency Licensing Requirements.

Summary of the rule or change:

This rule is being repealed in its entirety and replaced with Rule R590-244. (DAR NOTE: The proposed new Rule R590-244 was published in the May 15, 2009, Bulletin under DAR No. 32541 and was effective 07/01/2009.)

State statutory or constitutional authorization for this rule:

Sections 31A-23-216 and 31A-26-213

Anticipated cost or savings to:

the state budget:

The only impact to the state's budget, as a result of the repeal of this rule and enactment of Rule R590-244, is the loss of the nonelectronic processing fee of $25. Very few licensees filed by paper so the impact will be slight.

local governments:

The repeal of this rule will have no fiscal impact on local governments since this rule applies to the relationship between the department and its licensees and will not have any fiscal impact on local governments.

small businesses and persons other than businesses:

The only fiscal impact on small agencies and insurers will be to those few who filed by paper. They will need to pay the vendor for the electronic processing fee, which is less than the state's paper processing fee. Also, they will no longer have costs associated with mailing paper forms.

Compliance costs for affected persons:

The only fiscal impact on large agencies and insurers will be to those few that filed by paper. They will need to pay the vendor for the electronic processing fee, which is less than the state's paper processing fee. Also, they will no longer have costs associated with mailing paper forms.

Comments by the department head on the fiscal impact the rule may have on businesses:

The repeal of this rule will have little, if any, fiscal impact on Utah agencies and insurers since most already file electronically. D. Kent Michie, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Administration
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY UT 84114-1201

Direct questions regarding this rule to:

Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at jwhitby@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

09/14/2009

This rule may become effective on:

09/21/2009

Authorized by:

Jilene Whitby, Information Specialist

RULE TEXT

R590. Insurance, Administration.

[R590-141. Individual and Agency License Lapse and Reinstatement Rule.

R590-141-1. Authority.

This rule is promulgated pursuant to Subsections 31A-23-216(3) and 31A-26-213(3), that authorize the commissioner to write a rule prescribing license renewal and reinstatement procedures for licensees under Chapters 23 and 26.

 

R590-141-2. Scope.

This rule applies to all individuals and agencies previously licensed under this chapter who did not renew their license on or prior to the license expiration date.

 

R590-141-3. Rule.

A. The individual and agency license renewal process shall be as follows:

(1) Renewal notices shall be mailed to the licensee's business address as shown on the records of the Insurance Department. Licensees who fail to notify the department when their business address changes may face administrative penalties.

(2) Licenses shall lapse if they are not renewed on or prior to the license expiration date.

(3) Individuals and agencies with lapsed licenses may not engage in the business of insurance during any period between the date of expiration of the license and the date of reinstatement of that license.

(4) Lapsed licenses can be reinstated subject to the provisions outlined below.

B. Reinstatement of Lapsed Individual Licenses.

(1) For reinstatement within the first month following the license expiration date:

(a) the individual shall complete all continuing education requirements;

(b) the individual shall pay all current and past due fees - renewal, continuing education, etc;

(c) the individual shall pay a penalty fee equal to the renewal fee; and

(d) no agency designations or appointments shall be canceled nor will agencies and insurers be notified of the non-renewal during this one month period.

(2) For reinstatement during the time between one and six months following the license expiration date, the individual shall:

(a) complete all continuing education requirements;

(b) pay all current and past due fees - renewal, continuing education, etc;

(c) pay a penalty fee equal to the renewal fee; and

(d) complete new producer contracts, new agency designations and new insurer appointments before the reinstated licensee can resume doing business. Agencies and insurers will have been notified that the licensee's license had lapsed.

(3) For reinstatement during the time between seven months and 12 months following the license expiration date, the individual shall:

(a) complete all continuing education requirements;

(b) pay all current and past due fees - renewal, continuing education, etc;

(c) pay a penalty fee equal to the renewal fee plus $50; and

(d) complete new producer contracts, new agency designations and new insurer appointments before the reinstated licensee can resume doing business. Agencies and insurers will have been notified that the licensee's license lapsed.

(4) For reinstatement during the time between 13 months and 24 months following the license expiration date, the individual shall:

(a) complete all continuing education requirements;

(b) pay all current and past due fees - renewal, continuing education, etc;

(c) take and successfully pass the proper agent licensing examination;

(d) pay a penalty fee equal to the renewal fee. If the applicant is exempt from licensing examination, the applicant shall pay a penalty fee equal to the renewal fee plus $75; and

(e) complete new producer contracts, new agency designations and new insurer appointments before the reinstated licensee can resume doing business. Agencies and insurers will have been notified that the licensee's license lapsed.

(5) A license that has not been reinstated within 24 months following its expiration date cannot be reinstated. An application for a new license must be made and the applicant must comply with all the requirements applicable to a new license.

C. Reinstatement of Lapsed Agency Licenses.

(1) For reinstatement within the first month following the license expiration date:

(a) the agency shall pay all current and past due fees - renewal, etc;

(b) the agency shall pay a penalty fee equal to the renewal fee; and

(c) No agency designations or insurer appointments shall be canceled nor will agency designees and insurers be notified of the non-renewal during this one month period.

(2) For reinstatement during the time between one and 24 months following the license expiration date, the agency shall:

(a) pay all current and past due fees - renewal, etc; - and

(b) pay a penalty fee equal to the renewal fee plus $50.

(c) complete new contracts and appointments with insurers and new designations for agents representing the agency before the reinstated licensee can resume doing business. Designees and insurers will have been notified that the licensee's license lapsed.

(3) A license that has not been reinstated within 24 months following its expiration date cannot be reinstated. An application for a new license must be made and the applicant must comply with all the requirements applicable to a new license.

(4) In the event an agency fails to renew or reinstate its license within the prescribed time, the name of the agency shall not be available for use for a period of three years from the date the license lapsed.

 

R590-141-4. Severability.

If any provision or clause of this rule or its application to any person or situation is held invalid, such invalidity may not affect any other provision or application of this rule which can be given effect without the invalid provision or application, and to this end the provisions of this rule are declared to be severable.

 

KEY: insurance

Date of Enactment or Last Substantive Amendment: May 1, 1998

Notice of Continuation: November 6, 2007

Authorizing, and Implemented or Interpreted Law: 31A-2-201; 31A-23-216; 31A-26-213]

 

 

ADDITIONAL INFORMATION

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For questions regarding the content or application of this rule, please contact Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at jwhitby@utah.gov

For questions about the rulemaking process, please contact the Division of Administrative Rules (801-538-3764). Please Note: The Division of Administrative Rules is NOT able to answer questions about the content or application of these administrative rules.

Last modified:  07/30/2009 6:29 PM