§4488. Licensing of agents

Link to law: http://legislature.vermont.gov/statutes/section/08/121/04488
Published: 2015

Print

The Vermont Statutes Online



Title

08

:
Banking and Insurance






Chapter

121

:
FRATERNAL BENEFIT SOCIETIES











 

§

4488. Licensing of agents

Agents of

societies shall be licensed in accordance with the provisions of this section.

(1) Insurance

agent defined. The term "insurance agent" as used in this section

means any authorized or acknowledged agent of a society who acts as such in the

solicitation, negotiation, procurement, or making of a life insurance, accident

and health insurance, or annuity contract.

(2) License

required. Any person who in this State acts as insurance agent for a society

without having authority so to do by virtue of a license issued and in force

pursuant to the provisions of this section shall, except as provided in

subdivision (1) of this section, be guilty of a misdemeanor.

(3) Payment of

commissions forbidden. No society doing business in this State may pay any

commission or other compensation to any person for any services in obtaining in

this State any new contract of life, accident, or health insurance, or any new

annuity contract, except to a licensed insurance agent of the society and

except to an agent exempted by the Commissioner of Financial Regulation.

(4)

Prerequisites, issuance, and renewal of insurance agents' licenses.

(A) The

Commissioner of Financial Regulation may issue a license to any person who has

paid an annual license fee of $30.00 and who has complied with the requirements

of this section, authorizing the licensee to act as an insurance agent on

behalf of any society named in the license which is authorized to do business

in this State.

(B) Before any

insurance agent's license shall be issued there shall be on file in the office

of the Commissioner of Financial Regulation the following documents:

(i) A written

application by the prospective licensee in such form or forms and supplements

thereto, and containing such information, as the Commissioner of Financial

Regulation may prescribe.

(ii) A

certificate by the society which is to be named in the license, stating that

the society has satisfied itself that the named applicant is trustworthy and

competent to act as an insurance agent and that the society will appoint the

applicant to act as its agent if the license applied for is issued by the

Commissioner of Financial Regulation. The certificates shall be executed and

acknowledged by an officer or managing agent of the society.

(C) A written

examination may be required of any individual seeking to be named as a licensee

to represent a fraternal benefit society as its agent.

(D) The

Commissioner of Financial Regulation may refuse to issue or renew any insurance

agent's license if in his or her judgment the proposed licensee is not

trustworthy and competent to act as an agent, or has given cause for revocation

or suspension of the license, or has failed to comply with any prerequisite for

the issuance or renewal, as the case may be, of the license.

(E) Every

license issued pursuant to this section, and every renewal thereof, shall

expire on December 31 of the even-numbered calendar year following the calendar

year in which the license or renewal license was issued.

(F) If the application

for a renewal license has been filed with the Commissioner of Financial

Regulation on or before December 31 of the year in which the existing license

is to expire, the applicant named in the existing license may continue to act

as insurance agent under the existing license, unless it shall be revoked or

suspended, until the issuance by the Commissioner of Financial Regulation of

the renewal license or until the expiration of five days after he or she has

refused to renew the license and has served written notice of the refusal on

the applicant. If the applicant shall, within 30 days after the notice is

given, notify the Commissioner of Financial Regulation in writing of his or her

request for a hearing on such refusal, the Commissioner of Financial Regulation

shall, within a reasonable time after receipt of such notice, grant the

hearing, and he or she may, in his or her discretion, reinstate the license.

(G) A renewal

license of an insurance agent may be issued upon the application of the society

named in the existing license. The application shall be in the form or forms

prescribed by the Commissioner of Financial Regulation and shall contain such

information as he or she may require. The application shall contain a

certificate executed by the president, or by a vice president, a secretary, an

assistant secretary, or corresponding officer by whatever name known, or by an

employee expressly designated and authorized to execute the certificate of a

domestic or foreign society or by the United States manager of an alien

society, stating that the addresses therein given of the agents of the society

for whom renewal licenses are requested therein have been verified in each

instance immediately preceding the preparation of the application.

Notwithstanding the filing of the application, the Commissioner of Financial

Regulation may, after reasonable notice to the society, require that any or all

agents of the society to be named as licensees in renewal licenses shall

execute and file separate applications for the renewal of the licenses, as

hereinbefore specified, and he or she may also require that each such

application shall be accompanied by the certificate specified in subdivision

(B)(ii) of this subdivision (4).

(5) Notice of

termination of appointment of insurance agent. Notice of termination of

appointment of insurance agent. Every society doing business in this State

shall, upon the termination of the appointment of any insurance agent licensed

to represent it in this State, forthwith file with the Commissioner of

Financial Regulation, a statement, in such form as he or she may prescribe, of

the facts relative to the termination and the cause thereof. Every statement

made pursuant to this section is privileged and shall be kept confidential to

the same extent as provided under subsection 4813m(f) of this title.

(6) Revocation

or suspension of insurance agent's license.

(A) The

Commissioner of Financial Regulation may revoke or may suspend for such period

as he or she may determine, any insurance agent's license if, after notice and

hearing as specified in this section, he or she determines that the licensee

has:

(i) violated any

provision of, or any obligation imposed by, this section, or has violated any

law in the course of his or her dealings as agent;

(ii) made a

material misstatement in the application for the license;

(iii) been

guilty of fraudulent or dishonest practices;

(iv)

demonstrated his or her incompetency or untrustworthiness to act as an

insurance agent; or

(v) been guilty

of rebating as defined by the laws of this State applicable to life insurance

companies.

(B) The

revocation or suspension of any insurance agent's license shall terminate

forthwith the license of the agent. No individual whose license has been

revoked shall be entitled to obtain any insurance agent's license under the

provisions of this section for a period of one year after the revocation or, if

the revocation be judicially reviewed, for one year after the final

determination thereof affirming the action of the Commissioner of Financial

Regulation in revoking the license. (Added 1959, No. 197, § 28, eff. Nov. 22,

1959; amended 1985, No. 236 (Adj. Sess.), § 1, eff. June 3, 1986; 1989, No. 225

(Adj. Sess.), § 25; 1991, No. 166 (Adj. Sess.), § 9; 1995, No. 180 (Adj.

Sess.), § 38; 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012; 2015, No. 29,

§ 7.)
Read Entire Law on legislature.vermont.gov