26-9-229. Reporting and accounting for premiums.
(a) Any premiums or return premiums received by an insurance producer are trust funds received in a fiduciary capacity, and the producer, in the regular course of business, shall account for and pay the funds to the insured, insurer or insurance producer entitled thereto.
(b) The licensee shall establish a separate trust account for premiums specified in subsection (a) of this section and shall not use the account for or commingle it with his own funds. He shall maintain an accurate record and itemization of the funds deposited in the account.
(c) Any insurance producer who diverts or appropriates any funds, to which he is not lawfully entitled, to his own use is guilty of embezzlement and upon conviction shall be punished as provided by law.
(d) A limited lines producer for specialty limited lines shall not be required to treat monies collected from customers purchasing additional specialty limited lines insurance as funds received in a fiduciary capacity, provided that:
(i) The charges for specialty limited lines insurance coverage are itemized and ancillary to the principal business transaction; and
(ii) The insurer has consented in writing, signed by an officer of the insurer, that premiums need not be segregated from funds received by the producer for the principal business transaction.
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