Arkansas Code of 1987 (2023) › Title 23 - PUBLIC UTILITIES AND REGULATED INDUSTRIES (§§ 23-1-101 — 23-119-105) › Subtitle 3 - INSURANCE (§§ 23-60-101 — 23-103-417) › Chapter 81 - LIFE INSURANCE POLICIES AND ANNUITIES (§§ 23-81-101 — 23-81-905) › Subchapter 8 - LIFE SETTLEMENTS ACT (§§ 23-81-801 — 23-81-818) › Section 23-81-803 - Licensing requirements

(a)
A person, wherever located, shall not act as a provider or broker with an owner or multiple owners who is a resident of this state without first having obtained a license from the Insurance Commissioner.
(b)
(1)
Application for a provider or broker license shall be made to the commissioner by the applicant on a form prescribed by the commissioner, and the application shall be accompanied by a fee in an amount established by the commissioner.
(2)
However, the license and fees to continue the license for a provider license shall be reasonable, and the license and fees to continue the license for a broker license shall not exceed those established for an insurance producer, as such fees are otherwise provided for by statute or rule of the commissioner.
(c)
A life insurance producer who has been licensed as a resident insurance producer with a life line of authority in this state or his or her home state for at least one (1) year and is licensed as a nonresident producer in this state shall be deemed to meet the licensing requirements of this section and shall be permitted to operate as a broker.
(d)
(1)
Not later than thirty (30) days from the first day of operating as a broker, the life insurance producer shall notify the commissioner that he or she is acting as a broker on a form prescribed by the commissioner and shall pay any applicable fee to be determined by the commissioner.
(2)
Notification shall include an acknowledgement by the life insurance producer that he or she will operate as a broker in accordance with this subchapter.
(e)
The insurer that issued the policy that is the subject of a life settlement contract shall not be responsible for any act or omission of a broker or provider or purchaser arising out of or in connection with the life settlement transaction unless the insurer receives compensation for the placement of a life settlement contract from the provider or purchaser or broker in connection with the life settlement contract.
(f)
A person licensed as an attorney, certified public accountant, or financial planner accredited by a nationally recognized accreditation agency who is retained to represent the owner and whose compensation is not paid directly or indirectly by the provider or purchaser may negotiate life settlement contracts on behalf of the owner without having to obtain a license as a broker.
(g)
(1)
Licenses issued under this subchapter may be continued by paying the fees and satisfying the education and other requirements established by rule of the commissioner.
(2)
Failure to pay the fee within the terms prescribed shall result in the automatic revocation of the license.
(h)
(1)
The applicant shall provide such information as the commissioner may require on forms prepared by the commissioner.
(2)
The commissioner may require the applicant to fully disclose the identity of its stockholders other than stockholders owning less than ten percent (10%) of the shares of an applicant whose shares are publicly traded, partners, officers, and employees, and the commissioner, in the exercise of the commissioner's sole discretion, may refuse to issue such a license in the name of any person if not satisfied that any officer, employee, stockholder, or partner thereof who may materially influence the applicant's conduct meets the standards of §§
23-81-801
-
23-81-814
.
(i)
A license issued to a partnership, corporation, or other entity authorizes all members, officers, and designated employees to act as licensees under the license, if those persons are named in the application and any supplements to the application.
(j)
Upon the filing of an application and the payment of the license fee, the commissioner shall make an investigation of each applicant and may issue a license if the commissioner finds that the applicant:
(1)
If a provider, has provided a detailed plan of operation;
(2)
Is competent and trustworthy and intends to transact its business in good faith;
(3)
Has a good business reputation and has had experience, training, or education so as to be qualified in the business for which the license is applied;
(4)
If the applicant is a legal entity, is formed or organized pursuant to the laws of this state, is a foreign legal entity authorized to transact business in this state, or provides a certificate of good standing from the state of its domicile; and
(5)
Has provided to the commissioner an antifraud plan that meets the requirements of §
23-81-814
and includes:
(A)
A description of the procedures for detecting and investigating possible fraudulent acts and procedures for resolving material inconsistencies between medical records and insurance applications;
(B)
A description of the procedures for reporting fraudulent insurance acts to the commissioner;
(C)
A description of the plan for antifraud education and training of its underwriters and other personnel; and
(D)
A written description or chart outlining the arrangement of the antifraud personnel who are responsible for the investigation and reporting of possible fraudulent insurance acts and investigating unresolved material inconsistencies between medical records and insurance applications.
(k)
The commissioner shall not issue any license to any nonresident applicant unless a written designation of an agent for service of process is filed under §
4-20-112
and maintained with the commissioner or unless the applicant has filed with the commissioner the applicant's written irrevocable consent that any action against the applicant may be commenced against the applicant by service of process on the commissioner.
(l)
Each licensee shall file with the commissioner on or before March 1 of each year an annual statement containing such information as the commissioner by rule may prescribe.
(m)
A provider shall not use any person to perform the functions of a broker as defined in this subchapter unless the person holds a current, valid license as a broker, as provided in this section.
(n)
A broker shall not use any person to perform the functions of a provider as defined in this subchapter unless the person holds a current, valid license as a provider, as provided in this section.
(o)
A provider or broker shall provide to the commissioner new or revised information about officers, ten percent (10%) or more stockholders, partners, directors, members, or designated employees within thirty (30) days of the change.
(p)
(1)
(A)
An individual licensed as a broker shall complete on a biennial basis a minimum of fifteen (15) hours of training related to life settlements and life settlement transactions, as required by the commissioner.
(B)
However, a life insurance producer who is operating as a broker pursuant to this section shall not be subject to the requirements of this subsection.
(2)
Any person failing to meet the requirements of this subsection shall be subject to the penalties imposed by the commissioner.
Acts 2009, No. 796, § 1.