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The Vermont Statutes Online
Title
08
:
Banking and Insurance
Chapter
138
:
NON-ADMITTED INSURERS AND SURPLUS LINES INSURANCE
§
5027. Evidence of the insurance; changes; penalty
(a) Where
Vermont is the home state of the insured, the surplus lines broker, upon
placing a domestic risk with a surplus lines insurer, shall promptly deliver to
the insured the policy issued by the surplus lines insurer, or if such policy
is not then available, a certificate, cover note, or other confirmation of
insurance, showing the description and location of the subject of the
insurance, coverage, conditions and term of the insurance, the premium and rate
charged and taxes collected from the insured, and the name and address of the
insured and surplus lines insurer. If the risk is assumed by more than one
insurer, the document or documents shall state the name and address and
proportion of the entire risk assumed by each insurer.
(b) No surplus
lines broker shall issue or deliver such policy or such confirmation of
insurance or represent that insurance will be or has been written by any
non-admitted surplus lines insurer unless he or she has written authority from
the surplus lines insurer to assume the risk or has received confirmation from
the surplus lines insurer in the regular course of business that such insurance
has been granted.
(c) If, after
delivery of any such document, there is any change in the identity of the
insurers, the proportion of the risk assumed by any insurer, or any other
material change in coverage evidenced by an appropriate document, the surplus
lines broker shall promptly deliver to the insured an appropriate substitute for,
or endorsement of the original document, accurately showing the current status
of the coverage and the insurers responsible thereunder. The document as
modified and issued must conform to all the requirements of this chapter, and
any such change resulting in a violation of this chapter is prohibited.
(d) As soon as
reasonably possible, and in no event later than 60 days after placement of any
such insurance, the surplus lines broker shall procure from the insurer a full
and properly executed policy and deliver it to the insured to replace any
confirmation previously issued. The word "policy," as used in this
section, shall include a certificate of insurance or cover note bound under a
fully executed and effective contract from a bona fide intermediary or general
agent for a surplus lines insurer, provided that it contains or has attached to
it all insuring agreements, clauses, conditions, endorsements, exclusions, or
any other material provisions that would regularly be included in such a
policy.
(e) Any surplus
lines broker who fails to comply with the requirements of this section shall be
subject to the penalties provided in this chapter. (Added 1979, No. 50, § 2;
amended 1979, No. 197 (Adj. Sess.), § 5; 2001, No. 97 (Adj. Sess.), § 19; 2011,
No. 49, § 6, eff. May 26, 2011.)