Connecticut General Statutes 38a-935 – Recovery of premiums owed. Penalty. Appeals
(a)(1) A producer, premium finance company or any other person, other than the insured, responsible for the payment of a premium shall pay any unpaid collected premium including any amount representing commissions held by such person at the time of the entry of the liquidation order, whether earned or unearned based on the termination of coverage under § 38a-921, and any unpaid earned premium, all as shown on the records of the insurer. A producer, premium finance company or any other person shall have no obligation to pay an uncollected unpaid unearned premium to the liquidator. (2) The liquidator shall also have the right to recover from any person other than the insured, responsible for the payment of a premium, any unearned commission actually paid or credited to such person based on the termination of coverage under § 38a-921. Credits or set-offs or both shall not be allowed to a producer or premium finance company, or any other person against unpaid premium due the insurer for any amounts advanced to the insurer by such person on behalf of, but in the absence of a payment by, the insured, or for any other amount paid by such person to any other person after the entry of the order of liquidation. (3) An insured shall pay, either directly to the liquidator or to any agent who has paid or is obligated to pay the liquidator on behalf of the insured, any unpaid earned premium or retrospectively rated premium due the insurer based on the termination of coverage under § 38a-921. Premium on surety business shall be deemed earned at inception if no policy term can be determined. All other premium shall be deemed earned and shall be prorated over the determined policy term, regardless of any provision in the bond, guaranty, contract or other agreement. If a claim for losses incurred under a policy is approved by the court under subsection (b) of § 38a-945, then all premium for the full policy term shall be deemed earned. (4) Any person who collected premium, or financed premium under a premium finance contract, that is due the insurer in liquidation shall be deemed to hold that premium in trust as a fiduciary for the benefit of the insurer and to have availed himself of the laws of this state, regardless of any provision in any agency contract or other agreement. (5) Any premium finance company shall be obligated to pay any amounts due the insurer from premium finance contracts, whether the premium is earned or unearned. The liquidator has the right to collect any unpaid financed premium directly from the premium finance company, by taking an assignment of the underlying premium finance contracts, or directly from the insured who is a party to the premium finance contract.
Terms Used In Connecticut General Statutes 38a-935
- Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
- Commissioner: means the Insurance Commissioner. See Connecticut General Statutes 38a-1
- Contract: A legal written agreement that becomes binding when signed.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Fiduciary: A trustee, executor, or administrator.
- Insured: means a person to whom or for whose benefit an insurer makes a promise in an insurance policy. See Connecticut General Statutes 38a-1
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a business trust, an unincorporated organization or other legal entity. See Connecticut General Statutes 38a-1
- Policy: means any document, including attached endorsements and riders, purporting to be an enforceable contract, which memorializes in writing some or all of the terms of an insurance contract. See Connecticut General Statutes 38a-1
- State: means any state, district, or territory of the United States. See Connecticut General Statutes 38a-1
- Venue: The geographical location in which a case is tried.
(b) Upon satisfactory evidence of a violation of this section by a person other than an insured, the commissioner may require any of the following: (1) Suspend or revoke or refuse to renew the licenses of such offending party or parties; or (2) impose a penalty of not more than two thousand five hundred dollars for each act in violation of this section by said party or parties.
(c) Before the commissioner takes any action as set forth in subsection (b) of this section, he shall give written notice to the person, company, association, or exchange accused of violating the law, stating specifically the nature of the alleged violation, and fixing a time and place, at least ten days thereafter, when a hearing on the matter shall be held. After such hearing, or upon failure of the accused to appear at such hearing, the commissioner, if he shall find such violation, shall impose such of the penalties under subsection (b) of this section as he deems advisable.
(d) Any person aggrieved by the action of the commissioner in revoking, suspending or refusing to grant a license or in imposing a fine may appeal therefrom in accordance with the provisions of § 4-183, except venue for such appeal shall be in the judicial district of Hartford.