Senate Bill No. 360
(By Senator Helmick, Ross, Minard and Fanning)
[Introduced February 1, 2000; referred to the Committee
on Banking and Insurance.]
A BILL to amend and reenact section thirty-two, article twelve,
chapter thirty-three of the code of West Virginia, one
thousand nine hundred thirty-one, as amended; and to amend
and reenact section two, article twelve-a of said chapter,
all relating to the extension of commission rights to
additional insurance agents and including, with minor
exceptions, all insurers.
Be it enacted by the Legislature of West Virginia:
That section thirty-two, article twelve, chapter
thirty-three of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, be amended and reenacted; and
that section two, article twelve-a of said chapter be amended and reenacted, all to read as follows:
ARTICLE 12. AGENTS, BROKERS, SOLICITORS AND EXCESS LINE.
§33-12-32. Termination of contractual relationship; continuation
of certain commissions; exceptions.
(a) In the event of a termination of a contractual
relationship between a duly licensed insurance agent and an
automobile insurer, of private passenger automobiles who is
withdrawing from writing private passenger automobile insurance
within the state the insurer shall pay the agent a commission,
equal to the commission the agent would have otherwise been
entitled to under his or her contract with the insurer, for a
period of two years from the date of termination of the
contractual relationship for those renewal policies that cannot
otherwise be canceled or nonrenewed pursuant to law, which
policies the agent continues to service. The insurer must
continue the appointment of the agent for the duration of time
the agent continues to service the business and solely for the
purpose of servicing the agent's existing business: Provided,
That this requirement shall not obligate the withdrawing insurer
to accept any new private passenger automobile insurance within
(b) Subsection (a) of this section does not apply to an
agent who is an employee of the insurer,
or an agent as defined
by article twelve-a of this chapter, or an agent, who by
contractual agreement either represents only one insurer or group
of affiliated insurers or who is required by contract to submit
risks to a specified insurer or group of affiliated insurers
prior to submitting them to others.
ARTICLE 12A. CONTRACTUAL RELATIONSHIP BETWEEN INSURANCE
COMPANIES AND AGENTS.
As used in this article:
(a) "Insurance company" means any individual, firm or
corporation engaged in the business of selling insurance in this
state, excepting only: (1) Clubs or associations organized under
the laws of this state which sell insurance to their members; and
(2) companies engaged exclusively in the sale of life or accident
and sickness insurance.
(b) "Insurance agent" means any individual, firm or
corporation appointed by an insurance company, as defined herein,
whose exclusive activity in this field is in behalf of
an insurance company and who is authorized by that company to solicit insurance or to negotiate insurance on its behalf, and
who is authorized by the insurance company to effectuate and
countersign insurance contracts on its behalf.
NOTE: The purpose of this legislation is to protect the
insurance consumer's right to representation by the insurance
agent of their choice, in situations where an insurance company
cancels an insurance agent's contract for any reason other than
the state's definition of "good cause." The bill allows
insurance agents to continue to provide representation of
consumers for whose policies the state mandates a continuation of
coverage, and in such instances, for those insurance agents to
receive full compensation for such service for as long as the
insurance company provides coverage, and to include insurance
agents who represent more than one insurance company within the
definition of "insurance agent."
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.