MISSISSIPPI LEGISLATURE

1998 Regular Session

To: Insurance

By: Senator(s) Hewes

AN ACT TO AMEND SECTIONS 83-17-21 AND 83-17-23, MISSISSIPPI CODE OF 1972, TO EXEMPT CERTAIN INSURERS FROM COUNTERSIGNATURE REQUIREMENTS ON THE POLICIES THEY ISSUE; TO EXPAND THE LINES OF INSURANCE EXEMPT FROM COUNTERSIGNATURE REQUIREMENTS TO OCEAN MARINE AND CUSTOMS BONDS; AND FOR RELATED PURPOSES.  

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 83-17-21, Mississippi Code of 1972, is amended as follows:

83-17-21. No fire, fire marine, accident, health, employers' liability, steam boiler, plate glass, fidelity, surety, burglary, or other insurance company except life insurance companies, not incorporated under the laws of this state authorized to transact business herein shall make, write, place, or cause to be made, written, or placed any policy, duplicate policy, or contract of insurance of any kind or character or any general or floating policy upon persons or property in this state, except after the said risk has been approved, in writing, by a local agent who is a resident of this state, regularly commissioned or salaried and licensed to transact insurance business herein, who shall countersign all policies or contracts of insurance so issued and receive a minimum of fifty percent (50%) of the local agent's commission on business owned by a resident of Mississippi, and a minimum of twenty percent (20%) of the local agent's commission on business located in Mississippi but owned by a nonresident of Mississippi. This shall be done in order that the state may receive the taxes required by law to be paid on the premiums collected for insurance on all persons and property situated in this state. The provisions of this section shall not apply to individual firms and corporations indemnifying themselves through reciprocal contracts, and not employing local agents or to individual firms and corporations or insurers which do not employ agents or employ local agents who represent only one (1) insurer or insurer group. No provision of this section is intended, or shall be so intended, as to direct insurance covering the rolling stock of railroad corporations, or property in transit while in the possession and custody of railroad corporations or other common carriers. No provision of this section is intended to affect any surety bond or ocean marine insurance. The written approval and countersignature of local resident agents may be in facsimile * * *. The written approval and countersignature of local resident agents may also be in facsimile when authorization is given by the agent in writing to an insurer for which the agent is certified to do business pursuant to Section 83-17-5 or by means of a countersignature endorsement. The use of facsimile countersignatures shall not modify any of the other requirements of this section. Any authorization for a facsimile countersignature may be canceled by the agent in writing and is automatically canceled upon the death, termination or nonrenewal of the agent. It shall be the responsibility of the insurer to secure the payment of countersigning fees under this provision to the local resident licensed agent. In the event the proper countersignature fee is not paid, the insurer shall be subject to a penalty of One Hundred Dollars ($100.00) or three (3) times the normal gross commission of the policy, whichever is greater. This sum shall be paid to the Mississippi Insurance Department; and this department, at its discretion, may then pay the commission due under this section to the agent reporting the violation to the department. The Commissioner of Insurance may by regulation empower nonresident Mississippi licensed agents to affix the countersignature required by this section if such nonresident agent's jurisdiction would allow a Mississippi resident licensed nonresident agent the same privilege in such other jurisdiction.

SECTION 2. Section 83-17-23, Mississippi Code of 1972, is amended as follows:

83-17-23. Foreign fire insurance companies legally authorized to do business in this state, through * * * licensed agents * * *, shall * * * make contracts of fire insurance on property herein * * * through such licensed agents as are regularly salaried by them and licensed to write policies of fire insurance in this state. No provision of this section is intended to or shall apply to direct insurance covering the rolling stock of railroad corporations, or property in transit while in the possession or custody of railroad corporations or other common carriers, nor to insurers which do not employ agents or employ agents who represent only one (1) insurer or insurer group.

SECTION 3. This act shall take effect and be in force from and after July 1, 1998.