ENGROSSED
H. B. 2845
(By Delegates Thompson, H. White, Romine,
Angotti and L. white)
[Introduced February 19, 1999; referred to the
Committee on Banking and Insurance then Government Organization.]
A BILL to repeal section seven-a, article twelve, chapter thirty- three of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; and to amend and reenact
sections seven, eight, eight-a and twenty-four of said
article, all relating to the repeal of the countersignature
requirement and to the payment of commissions to agents.
Be it enacted by the Legislature of West Virginia:
That section seven-a, article twelve, chapter thirty-three
of the code of West Virginia, one thousand nine hundred thirty- ne, as amended, be repealed; and that sections seven, eight,
eight-a and twenty-four of said article be amended and reenacted,
all to read as follows:
ARTICLE 12. AGENTS, BROKERS, SOLICITORS AND EXCESS LINE.
§33-12-7. Countersignature.
No contract of insurance covering a subject of insurance,
resident, located, or to be performed in this state, shall be executed, issued or delivered by any insurer unless the contract,
or in the case of an interstate risk a countersignature
endorsement carrying full information as to the West Virginia
risk, is signed or countersigned in writing by a licensed
resident agent of the insurer except that excess line insurance
shall be countersigned by a duly licensed excess line broker. In
the event that the laws of another state require a signature or
countersignature by an agent resident in that state on a policy
written by a nonresident agent or nonresident broker of that
state, then any policy written by an agent resident of that state
licensed as a nonresident agent in this state covering a subject
of insurance resident, located, or to be performed in this state
shall be signed or countersigned in writing by a duly licensed
resident agent. This section does not apply to: Reinsurance;
credit insurance; any contract of insurance covering the rolling
stock of any railroad or covering any vessel, aircraft or motor
carrier used in interstate or foreign commerce, or covering any
liability or other risks incident to the ownership, maintenance
or operation thereof; any contract of insurance covering any
property in interstate or foreign commerce, or any liability or
risks incident thereto. Countersignature of a duly licensed
resident agent of the company originating a contract of insurance
participated in by other companies as cosureties or co- indemnitors shall satisfy all countersignature requirements in
respect to such contract of insurance.
§33-12-8. Licensing of nonresident life and accident and
sickness agents.
(a) Nonresidents otherwise complying with the provisions of
this chapter may be licensed as life agents. but all policies
issued as a result of solicitation on the part of such
nonresidents, in the state, shall be reported, placed,
countersigned, and consummated by and through a duly licensed
resident agent of the issuing insurer.
(b) An individual otherwise complying with the provisions of
this chapter, who is a resident of another state and who is a
licensed accident and sickness agent of such state, may be
licensed as a nonresident accident and sickness agent in this
state, if the state of residence of such nonresident has
established, by law or regulation like requirements for the
licensing of a resident of this state as a nonresident accident
and sickness agent. All policies issued as a result of
solicitation by such nonresident accident and sickness agents
shall be reported, placed, countersigned and consummated by and
through a duly licensed resident agent of the issuing insurer.
§33-12-8a. Licensing of nonresident property casualty agents.
(a) Nonresidents otherwise complying with the provisions of
this chapter may be licensed as a property casualty agent. but
all policies issued as a result of solicitation on the part of
such nonresident in this state shall be reported, placed,
countersigned, and consummated by and through a duly licensed resident agent of the issuing insurer.
(b) An individual otherwise complying with the provisions of
this chapter, who is a resident of another state and who is a
licensed property casualty agent of such state, may be licensed
as a nonresident property casualty agent in this state, if the
state of residence of such nonresident has established, by law or
regulation, like requirements for the licensing of a resident of
this state as a nonresident property casualty agent. All
policies issued as a result of solicitation by such nonresident
property casualty agents shall be reported, placed, countersigned
and consummated by and through a duly licensed resident agent of
the issuing insurer.
§33-12-24. Payment of commissions.
(a) In the event a countersignature is required under
section seven of this article, the entire commission payable by
any insurer licensed to transact insurance in this state on any
insurance policy shall be paid directly to the licensed resident
agent who countersigns the policy. The countersigning agent
shall not pay any part of such commission to any person other
than a licensed agent or broker. Provided, That the portion of
such commission retained by the countersigning resident agent
shall not be less than ten percent of the gross policy premium or
fifty percent of the commission payable by the insurer as
provided herein, whichever is the lesser amount. The term
"commission" as used herein shall include engineering fees, service fees or any other compensation incident to the issuance
of a policy payable by or to any insurer, agent or broker.
(b) It shall be unlawful for any insurer or agent to pay,
and any person to accept, directly or indirectly, any commission
except as provided in this section: Provided, That any licensed
resident agent may pay his or her commissions, or direct that his
or her commissions be paid, to a partnership of which he or she
is a member, employee or agent, or to a corporation of which he
or she is an officer, employee or agent, if:
(1) The commissioner finds that such partnership or
corporation is engaged, through its licensed resident agents, in
conducting an insurance agency business with respect to the
general public.
(2) If a partnership, each partner satisfies the
commissioner that he or she meets the licensing qualifications as
set forth in sections two, four, eight or eight-a of this
article.
(3) If a corporation, each officer, employee or any one or
more stockholders owning, directly or indirectly, the controlling
interest in such corporation satisfies the commissioner that he
or she meets the licensing qualifications as set forth in
sections two, four, eight, or eight-a of this article. The
requirements set forth in this subdivision shall not apply to
clerical employees, or other employees not directly engaged in
the selling or servicing of insurance.
(c) This section shall not apply to reinsurance, life
insurance or accident or health insurance; nor to excess line
insurance procured in accordance with the provisions of this
article relating thereto; nor to credit insurance, any contract
of insurance covering the rolling stock of any railroad or
covering any vessel, aircraft or motor carrier used in interstate
or foreign commerce, any liability or other risks incident to the
ownership, maintenance or operation thereof, any contract of
insurance covering any property in interstate or foreign
commerce, or any liability or risks incident thereto.