A. All insurance charges or premiums collected by an administrator for an insurer or trust and all return premiums received from the insurer or trust shall be held by the administrator in a fiduciary capacity. These funds shall be immediately remitted to the person entitled to the funds or shall be deposited promptly in a fiduciary bank account established and maintained by the administrator.
B. If charges or premiums deposited in a fiduciary account have been collected for more than one insurer or trust, the administrator shall keep records showing the deposits to and withdrawals from the account for each insurer or trust. The administrator, upon request of an insurer or trust, shall furnish copies of the records pertaining to deposits to and withdrawals from the account for that insurer or trust.
C. The administrator shall not pay any claim by withdrawals from a fiduciary account unless provisions for said withdrawals are included in the written agreement between the insurer or trust and the administrator. The written agreement shall authorize withdrawals by the administrator from the fiduciary account only for:
1. remittance to an insurer or trust entitled to a remittance; or
2. deposit in an account maintained in the name of an insurer or trust; or
3. transfer to and deposit in an account established for payment of claims, as provided for by subsection D of this section; or
4. payment to a group policyholder for remittance to the insurer or trust entitled to such remittance; or
5. payment of commission, fees, or charges to the administrator; or
6. remittance of return premiums to the person entitled to such return premiums.
D. All claims paid by the administrator from funds collected on behalf of the insurer or trust shall be paid on drafts or checks authorized by the insurer or trust.
Added by Laws 1983, c. 89, § 5, eff. Nov. 1, 1983.
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