MI Comp L § 500.1905 (2021)
2021 Michigan Compiled Laws|Chapter 500 - Insurance Code of 1956|Act 218 of 1956 - The Insurance Code of 1956 (500.100 - 500.8302)|218-1956-19 - Chapter 19 (500.1901...500.1955)|Section 500.1905 - License Required to Act as Agent or Broker in Transaction of Surplus Lines Insurance; Compliance; Requirements for Obtaining Surplus Lines License; Permissible Acts of Surplus Lines Licensee; Conditions to Placement of Insurance With Eligible Unauthorized Insurer.

500.1905 License required to act as agent or broker in transaction of surplus lines insurance; compliance; requirements for obtaining surplus lines license; permissible acts of surplus lines licensee; conditions to placement of insurance with eligible unauthorized insurer. Sec. 1905.  (1) A person shall not solicit insurance, bind coverage, or in any other manner act as an agent or broker in the transaction of surplus lines insurance unless licensed under this chapter and section 1206a.  (2) A person shall not offer, solicit, make a quotation on, sell, or issue a policy of insurance, binder, or any other evidence of insurance with an unauthorized insurer except in compliance with this chapter.  (3) To obtain a surplus lines license under subsection (1), a person shall do all of the following:  (a) File an application in the form and with the information as the commissioner may reasonably require to determine the ability of the applicant to satisfactorily act in accordance with this chapter.  (b) Complete an examination testing the applicant's understanding of this chapter, the surplus lines insurance business, and other chapters of this act, if required by the commissioner. The commissioner may waive the examination requirements for a person who has been licensed as a surplus lines licensee within the preceding 12 months.  (c) Comply with sections 1204 to 1206.  (d) Agree to file with the commissioner, not later than February 15 and August 15 annually, a sworn statement of the charges for insurance procured or placed, and the amounts returned on the insurance canceled, under the license, for the preceding 6-month period ending December 31 and June 30, respectively; and at the time of filing the statement, paying to the commissioner the 2% tax on premiums written and, instead of the costs and expenses that may be imposed by the commissioner pursuant to this chapter, a 0.5% regulatory fee on premiums written as required by section 451.  (4) A surplus lines licensee may do any or all of the following:  (a) Place insurance on risks in this state with eligible unauthorized insurers.  (b) Act in the capacity of an agent or broker, as determined by the contractual relationship with the eligible unauthorized insurer or that insurer's legal representative.  (c) Place insurance on risks in this state, with unauthorized insurers that are not eligible unauthorized insurers, in strict compliance with section 1950. If the insurance is provided through the participation of several insurers and the licensee has reason to believe that a substantial portion of the insurance would be assumed by authorized or eligible unauthorized insurers, then, with respect to the unauthorized insurers not eligible, the insured or the insured's representative shall be informed as provided in section 1950(a).  (d) Engage in any other acts expressly and implicitly authorized by this chapter and this act.  (5) Before placement of insurance with an eligible unauthorized insurer, a licensee shall inform an insured or the insured's representative that coverage is being placed with an insurer not licensed in this state and that payment of loss may not be guaranteed in the event of insolvency of the eligible unauthorized insurer. History: Add. 1980, Act 341, Eff. June 23, 1981 ;-- Am. 1987, Act 261, Imd. Eff. Dec. 28, 1987 ;-- Am. 1989, Act 214, Eff. Jan. 1, 1990 ;-- Am. 1994, Act 228, Imd. Eff. June 30, 1994 ;-- Am. 1996, Act 548, Imd. Eff. Jan. 15, 1997 ;-- Am. 2001, Act 228, Eff. Mar. 1, 2002 Popular Name: Act 218