reglab/statecodes huggingface dataset:
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-211 Annual reporting; books and records.

§431:19-211 Annual reporting; books and records.
(a) For purposes of section 431:19-107(a), the commissioner may require any appropriate or necessary modification or supplemental or additional information to be filed with the required financial statements.
(b) Unless otherwise approved in advance by the commissioner, a special purpose financial captive insurance company shall maintain its books, records, documents, accounts, vouchers, and agreements in this State. A special purpose financial captive insurance company shall make its books, records, documents, accounts, vouchers, and agreements available for inspection by the commissioner at any time. A special purpose financial captive insurance company shall keep its books and records in a manner that its financial condition, affairs, and operations can be readily ascertained and so that the commissioner may readily verify its financial statements and determine its compliance with this part.
(c) Unless otherwise approved in advance by the commissioner, all original books, records, documents, accounts, vouchers, and agreements shall be preserved and kept available in this State for the purpose of examination and inspection and until a time as the commissioner approves the destruction or other disposition of the books, records, documents, accounts, vouchers, and agreements. If the commissioner approves the keeping of the items listed in this subsection outside this State, then the special purpose financial captive insurance company shall maintain in this State a complete and true copy of each original. Books, records, documents, accounts, vouchers, and agreements may be photographed, reproduced on film, or stored and reproduced electronically. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-212 Suspension and revocation of certificate of authority.

§431:19-212 Suspension and revocation of certificate of authority.
(a) The commissioner shall notify a special purpose financial captive insurance company not less than thirty days before suspending or revoking its certificate of authority pursuant to section 431:19-109, which notice shall state the basis for the suspension or revocation. The special purpose financial captive insurance company shall be afforded the opportunity for a hearing pursuant to chapter 91.
(b) Notwithstanding subsection (a) and section 91-9.5, the commissioner may cause the immediate suspension or restriction of the special purpose financial captive insurance company's certificate of authority, subject to timely subsequent notice and opportunity for a hearing, upon the commissioner's determination that the failure to take an action may result in the material deterioration of the financial condition or soundness of the special purpose financial captive insurance company, and that for the protection of the public from the possible consequences of practices, the special purpose financial captive insurance company's certificate of authority should be immediately suspended or restricted.
The commissioner may order the summary suspension of the certificate of authority for a period not to exceed the later of thirty days or, if a hearing is requested by the special purpose financial captive insurance company pursuant to chapter 91, the conclusion of the hearing. Any attempt by the special purpose financial captive insurance company to continue its operations while its certificate of authority has been summarily suspended shall be sufficient to warrant a permanent revocation of the certificate of authority and shall subject the special purpose financial captive insurance company to all penalties prescribed by this article, or any rule or order issued by the commissioner.
(c) For purposes of this section, any reference to section 431:19-104 in section 431:19-109(a)(2) shall be construed to also reference section 431:19-207. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-214 Existing licenses.

§431:19-214 Existing licenses.
Except as otherwise determined by the commissioner, a captive insurance company, that has been issued a certificate of authority by the commissioner pursuant to section 431:19-102 as of July 1, 2008, and is engaged in or will be engaged in an insurance securitization, need not obtain a certificate of authority pursuant to section 431:19-204, but shall otherwise be subject to this part as a special purpose financial captive insurance company; provided that the commissioner may require the captive insurance company to take any action that the commissioner determines is reasonably necessary to bring the captive insurance company into compliance with this part; provided further that the commissioner may issue an order described in section 431:19-204(b) with respect to the captive insurance company. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-301 Formation.

§431:19-301 Formation.
(a) One or more sponsors may form a sponsored captive insurance company under this part. In addition to the general provisions of this article, the provisions of this part shall apply to sponsored captive insurance companies.
(b) A sponsored captive insurance company shall be incorporated as a stock insurer with its capital divided into shares and held by the stockholders, as a nonprofit corporation with one or more members, or as a member-managed or manager-managed limited liability company. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-302 Supplemental application materials.

§431:19-
302 Supplemental application materials.
In addition to the information required in section 431:19-102(c) and (d), each sponsored captive insurance company applicant that segregates the risks of its participants through one or more protected cells shall file with the commissioner the following:
(1) All contracts or draft contracts between the sponsored captive insurance company and its participants;
(2) A description of the means by which the assets, liabilities, income, and expenses of each protected cell shall be segregated from those of other protected cells in the sponsored captive insurance company, and reported to the commissioner; and
(3) A fair and equitable plan for allocating direct and indirect expenses to each protected cell. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-303 Protected cells.

§431:19-303 Protected cells.
A sponsored captive insurance company formed and licensed under this article may establish and maintain one or more protected cells to insure risks of one or more participants, subject to the following:
(1) The shareholders or members of a sponsored captive insurance company shall be limited to its participants and sponsors; provided that a sponsored captive insurance company may issue nonvoting securities to other persons on terms approved by the commissioner;
(2) A protected cell shall be organized and operated in only those forms of business organization authorized by the commissioner, including an association, corporation, limited liability company, partnership, or trust;
(3) Each protected cell shall be accounted for separately on the books and records of the sponsored captive insurance company to reflect the financial condition and results of operations of the protected cell, net income or loss, dividends or other distributions to participants, and other factors as may be provided in the participant contract or required by the commissioner;
(4) The assets of a protected cell shall not be chargeable with liabilities arising out of any other insurance business the sponsored captive insurance company may conduct;
(5) No sale, exchange, or other transfer of assets may be made by a sponsored captive insurance company between or among any of its protected cells without the consent of the protected cells;
(6) No sale, exchange, transfer of assets, dividend, or distribution may be made from a protected cell to a sponsor or participant without the commissioner's approval, and in no event shall the approval be given if the sale, exchange, transfer, dividend, or distribution would result in insolvency or impairment with respect to a protected cell;
(7) Each sponsored captive insurance company shall annually file with the commissioner, financial reports as the commissioner shall require, that shall include, without limitation, accounting statements detailing the financial experience of each protected cell;
(8) Each sponsored captive insurance company shall notify the commissioner in writing within ten business days of any protected cell that is insolvent or otherwise unable to meet its claim or expense obligations; and
(9) No participant contract shall take effect without the commissioner's prior written approval, and the addition of each new protected cell and withdrawal of any participant or termination of any existing protected cell shall constitute a change in business plan requiring the commissioner's prior written approval. [L 2008, c 190, pt of §1; am L 2010, c 7, §3]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-304 Qualification of sponsors.

§431:19-304
Qualification of sponsors.
A sponsor of a sponsored captive insurance company shall be an insurer licensed under laws of any state, a reinsurer authorized or approved under the laws of any state, a captive insurance company formed or licensed under this article, or any other person, company, or organization approved by the commissioner in the exercise of the commissioner's discretion, after finding that the approval of that person, company, or organization as a sponsor is not inconsistent with the purposes of this article. A risk retention group shall not be a sponsor of a sponsored captive insurance company. [L 2008, c 190, pt of §1; am L 2016, c 141, §10]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-305 Participants in sponsored captive insurance companies.

§431:19-305 Participants in sponsored captive insurance companies.
(a) Associations, corporations, limited liability companies, partnerships, trusts, risk retention groups, and other business entities may be participants in any sponsored captive insurance company formed or licensed under this chapter.
(b) A sponsor of a sponsored captive insurance company may be a participant.
(c) A participant need not be a shareholder or member of the sponsored captive insurance company or any affiliate thereof.
(d) A participant shall insure only its own risks through a sponsored captive insurance company. [L 2008, c 190, pt of §1; am L 2016, c 141, §11]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-306 Investments by sponsored captive insurance companies.

§431:19-306 Investments by sponsored captive insurance companies.
Notwithstanding section 431:19-303, the assets of two or more protected cells may be combined for purposes of investments, and the combination shall not be construed as defeating the segregation of the assets for accounting or other purposes. Sponsored captive insurance companies shall comply with the investment requirements under section 431:19-110. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-307 Delinquency of sponsored captive insurance companies.

§431:19-307 Delinquency of sponsored captive insurance companies.
In the case of a sponsored captive insurance company, article 15 shall apply; provided that:
(1) The assets of a protected cell may not be used to pay any expenses or claims other than those attributable to the protected cells; and
(2) Its capital and surplus shall at all times be available to pay any expenses of or claims against the sponsored captive insurance company. [L 2008, c 190, pt of §1]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-308 Applicable laws.

§431:19-308 Applicable laws.
A sponsored captive insurance company shall be subject to this part and to part I. If there is any conflict between this part and part I, this part shall control. [L 2008, c 190, pt of §1; am L 2012, c 253, §21]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:19-309 Existing licenses.

§431:19-309 Existing licenses.
Except as otherwise determined by the commissioner, a captive insurance company that has been issued a certificate of authority by the commissioner pursuant to section 431:19-102 as of July 1, 2008, and is licensed as a class 4 company shall not be required to re-apply for a certificate of authority under this part, but shall otherwise be subject to this part as a sponsored captive insurance company; provided that the commissioner may by order require the captive insurance company to take any action that the commissioner determines is reasonably necessary to bring the captive insurance company into compliance with this part. [L 2008, c 190, pt of §1; am L 2012, c 253, §22]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-101 Scope.

Case Notes
Mentioned: 74 H. 85, 839 P.2d 10 (1992).
§431:20-101 Scope.
This article relates only to title insurers and title insurance policies. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-102 Definitions.

§431:20-102 Definitions.
For the purposes of this article:
"Controlled escrow company" means each person engaged in the business of handling escrows of real property transactions in connection with which title policies are issued by a title insurer, which person:
(1) If an artificial person, directly or indirectly, is controlled by or controls, or is under common control with, a title insurer or is controlled by or controls, or is under common control with, an underwritten title company; or
(2) If a natural person, is employed by or controlled by a title insurer or by an underwritten title company.
"Title insurance business" or "business of title insurance" means:
(1) Issuing as insurer or offering to issue as insurer a title insurance policy; or
(2) Transacting or proposing to transact by a title insurer any of the following activities when conducted or performed in contemplation of the issuance of a title insurance policy:
(A) Soliciting or negotiating the issuance of a title insurance policy;
(B) Guaranteeing, warranting, or otherwise insuring the correctness of title searches;
(C) Handling of escrows, settlements, or closings;
(D) Execution of title insurance policies;
(E) Effecting contracts of reinsurance;
(F) Abstracting, searching, or examining titles; or
(G) Doing or proposing to do any business in substance equivalent to any of the foregoing in a manner designed to evade the provisions of this article.
"Title insurance policy" or "policy" means a contract issuing or indemnifying against loss or damage arising from any or all of the following existing on or before the policy date:
(1) Defects in, liens against, or encumbrances on the insured title;
(2) Unmarketability of the insured title; or
(3) Invalidity or unenforceability of liens or encumbrances on the stated property. Title insurance policy does not include a preliminary report, binder, commitment, or abstract.
"Title insurer" or "insurer" means a company organized under laws of this State for the purpose of transacting as insurer the business of title insurance, and any foreign or alien title insurer engaged in this State in the business of title insurance as insurer.
"Underwritten title company" means each person engaged in the business of preparing lien or title searches, title examinations, certificates of searches of title, or abstracts of title upon the basis of which a title insurer regularly writes title policies. [L 1987, c 347, pt of §2; am L 2019, c 111, §24]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-103 General insurance law applicable

§431:20-103 General insurance law applicable
. The following provisions shall apply to title insurance and to title insurers:
(1) Sections 431:1-103 and 431:1-105;
(2) Sections 431:1-212, 431:1-213, and 431:1-214;
(3) Sections 431:2-101 to 431:2-106, and sections 431:2-108 to 431:2-110;
(4) Sections 431:2-201 to 431:2-204, sections 431:2-207 to 431:2-212, and section 431:2-215;
(5) Sections 431:2-302, 431:2-303, 431:2-305, and 431:2-306;
(6) Sections 431:3-101 to 431:3-105;
(7) Sections 431:3-201 to 431:3-203, 431:3-205, and 431:3-206, and sections 431:3-209 to 431:3-220;
(8) Sections 431:3-301, 431:3-305, 431:3-307, and 431:3-308;
(9) Sections 431:4-102 to 431:4-127;
(10) Sections 431:4-202 to 431:4-207;
(11) Section 431:5-101;
(12) Sections 431:5-201 to 431:5-203;
(13) Sections 431:5-305 and 431:5-306, and sections 431:5-308 to 431:5-311;
(14) Article 6;
(15) Article 7;
(16) Article 9A;
(17) Sections 431:10-211, 431:10-216 to 431:10-218, and 431:10-220, 431:10-221, and 431:10-224, 431:10-225, and sections 431:10-235 to 431:10-238;
(18) Article 13; and
(19) Article 15. [L 1987, c 347, pt of §2; am L 1988, c 363, §2(4); am L 2002, c 155, §96; am L 2003, c 212, §117; am L 2006, c 154, §41]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-104 Particular provisions prevail.

§431:20-104 Particular provisions prevail.
If any provision of this code as incorporated in this article by section 431:20-103 is in conflict with any provision of this article, the provision contained in this article shall prevail. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-105 Authorized business.

§431:20-105 Authorized business.
(a) Each title insurer may engage in the title insurance business in this State if licensed to do so by the commissioner.
(b) Each domestic title insurer may issue policies and may also insure:
(1) The identity, due execution, and validity of any note or bond secured by mortgage;
(2) The identity, due execution, validity, recording of any such mortgage; and
(3) The identity, due execution, and validity of evidences of indebtedness issued by this State, by any political subdivision or district therein, or by any private or public corporation. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-106 Restrictions on business.

§431:20-106 Restrictions on business.
Any insurer which anywhere in the United States transacts any class of insurance other than title insurance is not eligible for the issuance of a certificate of authority to transact title insurance in this State nor for the renewal thereof, nor shall title insurance be transacted, underwritten or issued by any insurer transacting or licensed to transact any other kind of insurance. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-108 Guarantee fund.

§431:20-108 Guarantee fund.
(a) A title insurer, before issuing any title insurance policy covering property located in this State, shall deposit $400,000 with the commissioner, which deposit shall be known as a guarantee fund and shall be held for the security and protection of the holders or beneficiaries under its title insurance policies.
(b) The deposit required under subsection (a) may be made in lawful money of the United States or in the securities authorized for investment by domestic incorporated insurers under article 6 of this code.
(c) Assets deposited pursuant to subsection (a), with the commissioner's approval, may be exchanged from time to time for other assets that qualify under subsection (b).
(d) The depositing title insurer shall receive the income, interests, and dividends on any assets deposited.
(e) A title insurer that has deposited assets pursuant to this section, with the approval of the commissioner, may withdraw any part of the assets so deposited. If a title insurer continues to engage in the business of title insurance, it shall not be permitted to withdraw assets that would reduce the amount of its deposits below the amount required by subsection (a).
(f) In the event of the insolvency or dissolution of a title insurer, the deposit made pursuant to this section shall be retained by the commissioner until the time all outstanding liabilities created by the title insurance policies issued or reinsurance assumed by the title insurer have been discharged by reinsurance or otherwise. As much of the deposit as shall be necessary may be used by or with the written approval of the commissioner in the payment of claims arising under the title insurance policies or reinsurance assumed or to purchase reinsurance thereon. Any amounts then remaining shall be applied first to the payment of other obligations of the title insurer, and second, shall be distributed to the stockholders of the title insurer.
(g) In lieu of a deposit maintained in this State, the commissioner shall accept the certificate in proper form of the public officer having general supervision of insurers in any other state to the effect that a deposit, in a like amount, by the insurer is being maintained for like purposes in public custody or control pursuant to the laws of that state. [L 1987, c 347, pt of §2 as superseded by c 348, §22]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-109 Limitations on compliance with section 431:20-107 and section 431:20-108.

§431:20-109 Limitations on compliance with section 431:20-107 and section 431:20-108.
If section 431:20-107 or section 431:20-108 requires a greater amount of capital and surplus or deposits than that required of a title insurer prior to July 1, 1988, such title insurer shall have three years after July 1, 1988, to comply with any such increase requirement. [L 1987, c 347, pt of §2]
Revision Note
"July 1, 1988" substituted for "the effective date of this code" pursuant to §23G-15.
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-110 Purchase of materials and plant; valuation.

§431:20-110 Purchase of materials and plant; valuation.
Any domestic title insurer, after having its required capital paid in and depositing its required guarantee fund with the commissioner, may invest its funds in the preparation and purchase of materials and plant necessary to enable it to engage in the title insurance business. In all statements and proceedings required by law for the ascertainment and determination of the condition of such insurer, the materials and plant shall be treated in one of the following ways:
(1) They may be treated as an asset, valued at actual cost to the insurer not to exceed fifty per cent of the aggregate par value of the shares of the insurer's capital stock then issued, outstanding, and apportioned to its title insurance department, including treasury shares.
(2) They may be treated as an asset, at such lesser value than that permitted by item (1) as the insurer estimates.
(3) They may be omitted entirely from the statement or proceeding. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-110.5 Dividends.

§431:20-110.5 Dividends.
A title insurer shall not pay any dividends except from profits remaining on hand after retaining unimpaired assets aggregating in value an amount equal to the sum of the following:
(1) The aggregate par value of the shares of its capital stock, issued and outstanding, including treasury shares;
(2) The amount set apart as the title insurance reinsurance reserve; and
(3) A sum sufficient to pay all liabilities for expenses and taxes, all losses reported or in course of settlement, and all other indebtedness, without impairment of the amount required to be set apart as the title insurance reinsurance reserve. [L 1989, c 195, §8]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-111 Loans to officers, etc.

§431:20-111 Loans to officers, etc.
A title insurer shall not directly or indirectly make a loan from its assets to any of its officers, employees, or directors, or to any member of the family of any officer or director. Any officer, director, agent, or employee of any such insurer who knowingly consents to any violation of this section is guilty of a misdemeanor. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-112 Limit of risk.

§431:20-112 Limit of risk.
No insurer transacting title insurance in this State shall expose itself to any one risk in an amount exceeding fifty per cent of the aggregate amount of its total capital and surplus and its reserves other than its loss or claim reserves. As used in this section, the words "any one risk" mean the risk or hazard attaching to or arising in connection with any one piece or parcel of property, whether or not the policy insures other property. Any risk or portion of any risk which has been reinsured as authorized in this part shall be deducted in determining the limitation of risk prescribed in this section. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-113 Underwriting standards and record retention.

§431:20-113 Underwriting standards and record retention.
(a) No title insurance policy may be written unless and until the title insurer has caused to be conducted a reasonable search and examination of the title, and has caused to be made a determination of insurability of title in accordance with sound underwriting practices. Evidence of the examination of title and determination of insurability shall be preserved and retained in the files of the title insurer for a period of not less than fifteen years after the title insurance policy has been issued. Instead of retaining the original evidence, the title insurer may, in the regular course of business, establish a system whereby all or part of the evidence is recorded, copied or reproduced by any process that accurately and legibly reproduces or forms a durable medium for reproducing the contents of the original. This subsection shall not apply to:
(1) A title insurer assuming liability through a contract of reinsurance; or
(2) A title insurer acting as co-insurer if one of the other co-insuring title insurers has complied with this section.
(b) Except as allowed by regulations promulgated by the commissioner, no title insurer shall knowingly issue any title insurance policy or commitment to insure without showing all outstanding, enforceable recorded liens or other interests against the property title to which is to be insured. [L 1987, c 347, pt of §2]
Case Notes
Section mandates that title policies be issued based on title search results, not on indemnification of title insurer. 74 H. 85, 839 P.2d 10 (1992).
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-114 Reinsurance reserve.

§431:20-114 Reinsurance reserve.
(a) A domestic title insurer shall establish and maintain a reinsurance reserve computed in accordance with this section, and all sums attributed to the reserve shall at all times and for all purposes be considered and constitute unearned portions of the original premiums. This reserve shall be reported as a liability of the title insurer in its financial statements.
(b) The reinsurance reserve shall be maintained by the title insurer for the protection of holders of title insurance policies. Except as provided in this section, assets equal in value to the reinsurance reserve are not subject to distribution among creditors or stockholders of the title insurer until all claims of policyholders or claims under reinsurance contracts have been paid in full, and all liability on the policies or reinsurance contracts has been paid in full and discharged or lawfully reinsured.
(c) A foreign or alien title insurance company licensed to transact title insurance business in this State shall maintain at least the same reserves on title insurance policies issued on properties located in this State as are required of domestic title insurance companies, unless the laws of jurisdiction of domicile of the foreign or alien title insurance company require a higher amount.
(d) The reinsurance reserve shall consist of:
(1) The amount of this surplus fund on July 1, 1988; and
(2) A sum equal to twenty cents for each $1,000 of net retained liability under each title insurance policy on a single risk written on properties located in this State written after July 1, 1988.
(e) Amounts placed in the reinsurance reserve in any year in accordance with subsection (d)(2) shall be deducted in determining the net profit of the title insurer for that year.
(f) A title insurer shall release from the reinsurance reserve a sum equal to ten per cent of the amount added to the reserve during a calendar year on July 1 of each of the five years following the year in which the sum was added, and shall release from the reinsurance reserve a sum equal to three and one-third per cent of the amount added to the reserve during that year on each succeeding July 1 until the entire amount for that year has been released. The amount of the reinsurance reserve or similar unearned premium reserve maintained before July 1, 1988, shall be released in accordance with the law in effect before July 1, 1988. [L 1987, c 347, pt of §2 as superseded by c 348, §23]
Revision Note
"July 1, 1988" substituted for "the effective date of this code" or "Act" pursuant to §23G-15.
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-115 Use of reinsurance reserve on liquidation, dissolution or insolvency.

§431:20-115 Use of reinsurance reserve on liquidation, dissolution or insolvency.
(a) If a domestic title insurer becomes insolvent, is in the process of liquidation or dissolution, or is in the possession of the commissioner:
(1) The amount of the reinsurance reserve then remaining may be used by or with the written approval of the commissioner to pay for reinsurance of the liability of the title insurer upon all outstanding title insurance policies or reinsurance agreements to the extent for which claims for losses by the holders thereof are not then pending. The balance of the assets, if any, equal to the reinsurance reserve may be transferred to the general assets of the title insurer; and
(2) The assets net of the reinsurance reserve shall be available to pay claims for losses sustained by holders of title insurance policies then pending or arising up to the time reinsurance is effected. If claims for losses exceed any other assets of the title insurer, the claims, when established, shall be paid pro rata out of the surplus assets attributable to the reinsurance reserve, to the extent of the surplus, if any.
(b) If reinsurance is not obtained, assets equal to the reinsurance reserve and assets constituting minimum capital, or so much as remains thereof after outstanding claims have been paid, shall constitute a trust fund to be held and invested by the commissioner for twenty years, out of which claims of policyholders shall be paid as they arise. The balance, if any, of the trust fund, at the expiration of twenty years, shall revert to the general assets of the title insurer. [L 1987, c 347, pt of §2 as superseded by c 349, §13]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-116 Loss and loss expense reserve.

§431:20-116 Loss and loss expense reserve.
(a) All title insurers licensed in this State shall establish and maintain reserves against unpaid losses and loss expenses.
(b) Upon receiving notice from or on behalf of the insured of a title defect in, or lien or adverse claim against, the title of the insured that may result in a loss or cause expense to be incurred in the proper disposition of the claim, the title insurer shall determine the amount to be added to the reserve, which amount shall reflect a careful estimate of the loss or loss expense likely to result by reason of the claim.
(c) Reserves required under this section may be revised from time to time and shall be redetermined at least once each year. [L 1987, c 348, §24]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-117 Reinsurance.

§431:20-117 Reinsurance.
(a) A title insurer may obtain reinsurance for all or any part of its liability under one or more of its title insurance policies or reinsurance agreements, and may also reinsure title insurance policies issued by other title insurers on risks located in this State or elsewhere. Reinsurance on policies issued on properties located in this State must be obtained from title insurers authorized to transact title insurance business in this State.
(b) Upon application by a title insurer, the commissioner may permit the insurer to obtain reinsurance from an unauthorized title insurer upon the following conditions:
(1) The title insurer is unable to obtain reinsurance from a title insurer authorized to transact title insurance business in this State; and
(2) The capital and surplus of the unauthorized title insurer meets the requirements for authorized companies under section 431:20-107. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-118 Prohibition on rebates and inducements.

§431:20-118 Prohibition on rebates and inducements.
(a) No title insurer, controlled escrow company, or underwritten title company shall:
(1) Pay to the insured or to any other person any commission, any part of its premiums, fees or other charges; or any other consideration as inducement or compensation for the referral of title business, for performance of any escrow, or other service in connection with which a title policy is issued;
(2) Make any rebate of any portion of the fee or charge shown by the schedule required in section 431:20-120. For purposes of this article, the amount by which any fee or charge is less than that called for by the then currently effective schedule of fees and charges of the title insurer is an unlawful rebate; or
(3) Quote any fee or make any charge for a title policy to any person that is less than that currently available to others for the same type of title policy in a like amount covering property in the same county and involving the same factors as set forth in its then currently effective schedule of fees and charges. Nothing in this article shall prohibit bulk rates or special rates for customers of prescribed classes if the bulk or special rates are provided for in the schedule.
(b) No title insurer shall issue any title policy in any transaction in connection with which it or any person, who is a controlled escrow company or underwritten title company by reason of its relationship with such title insurer, has paid or contemplates paying any commission in violation of subsection (a)(1) or, in connection with which it or any such controlled escrow company or underwritten title company, has made or contemplates making any unlawful rebate in violation of subsection (a)(2).
(c) No insured named in a title insurance policy nor any other person may knowingly receive or accept, directly or indirectly, any commission, rebate or inducement referred to in subsection (a).
(d) Nothing in this section shall be construed as prohibiting reasonable payments, other than for the referral of title insurance business, for services actually rendered to a title insurer in connection with title insurance business. [L 1987, c 347, pt of §2; am L 2004, c 122, §78]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-119 Division of fees.

§431:20-119 Division of fees.
Nothing in this article shall prohibit the division of fees or charges between two or more title insurers or between one or more title insurers and one or more underwritten title companies, if such division does not constitute an unlawful rebate or inducement, or payment of a finder's fee; provided that a title insurer shall specify on any title policy issued by it, either in a single amount or by itemization, the entire charge made to obtain such title policy, including the charges made by any underwritten title company for the title search, title examination, certificate, or abstract of title upon the basis of which the title policy is issued. If so specified in a single amount, the charge shall be clearly described as the total charge for both the title insurance fee and the search, certificate, chain or abstract title, lien search, or any continuation of any of the above, as the case may be, of any underwritten title company. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-120 Schedules of premiums and charges.

§431:20-120 Schedules of premiums and charges.
(a) Every title insurer shall adopt, print, and make available to the public schedules of its currently effective premiums and charges.
(b) The schedules shall:
(1) Be printed in type not smaller than ten point;
(2) Be dated to show the date the premiums and charges become effective;
(3) Be kept available to the public and prominently displayed in a public place in each of the offices of the insurer, the controlled escrow company, and the underwritten title company in the particular county to which they relate;
(4) Set forth the total premium and charge for each type of title insurance policy or service issued or provided by the title insurer in the given amount of coverage, by a statement of the charge per unit of the amount of coverage, or a combination of the two; and
(5) Include the charge made by any underwritten title company for the search, certificate, chain or abstract of title, lien search, or any continuation of any of the above, upon the basis of which such title policy is issued.
(c) The schedule may:
(1) Include a statement that additional charges are made when unusual conditions of title are encountered or when special or unusual risks are insured against and that additional charges are made for special services rendered in connection with the issuance of a title policy; and
(2) Provide different fees or charges for title policies covering property in different counties or separate schedules may be adopted for title policies covering property in different counties.
(d) All or any part of any schedule may be changed or amended at any time or from time to time. Each change or amendment shall be printed and dated to show the effective date of the change or amendment. No change or amendment shall become effective until at least five days after it has been displayed in the offices of the title insurer in the same manner as provided for the display of schedules. No change or amendment increasing fees or charges shall apply to title policies ordered prior to the effective date of such change or amendment.
(e) Each title insurer, controlled escrow company, and underwritten title company shall keep a complete file of its schedules of premiums and charges and of all changes and amendments thereto until at least five years after they shall have ceased to be in effect, and such file shall be available for inspection by the commissioner. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-121 Contract forms, filing, disapproval.

§431:20-121 Contract forms, filing, disapproval.
(a) Every title insurer shall at least thirty days before use, file with the commissioner every form of insurance contract which it proposes to issue as to risks located in this State, together with the forms of all printed endorsements or other modifications of such contracts proposed to be used. Each filing shall be accompanied by a $20 fee payable to the commissioner, which fee shall be deposited in the commissioner's education and training fund.
(b) The commissioner may disapprove any such form if it:
(1) Is in violation of law;
(2) Contains inconsistent, ambiguous or misleading clauses, or exceptions and conditions which deceptively affect the risk purported to be assumed in the general coverage of the contract;
(3) Has any title, heading or other indication of its provisions which is misleading; or
(4) Is printed or otherwise reproduced in such manner as to render any material provision of the form substantially illegible.
(c) The commissioner shall not disapprove any such form after expiration of the initial thirty-day advance filing period except after a hearing thereon held in accordance with chapter 91.
(d) A title insurer shall not use in this State any form while it is so disapproved by the commissioner. [L 1987, c 347, pt of §2; am L 1988, c 363, §2(5)]
Cross References
Commissioner's education and training fund, see §431:2-214.
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-122 Annual statement.

§431:20-122 Annual statement.
Every title insurer shall include in its annual statement furnished to the commissioner pursuant to section 431:20-103(4), the name of each person in this State which is a controlled escrow company or underwritten title company by reason of its relationship with such title insurer. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-123 Remedies.

§431:20-123 Remedies.
In enforcing this article, the commissioner shall be entitled to the remedies provided for in section 431:20-103(2), (3), and (4). [L 1987, c 347, pt of §2; am L 2004, c 122, §79]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-124 Additional penalty.

§431:20-124 Additional penalty.
Every title insurer, controlled escrow company, and underwritten title company who pays any commission or who makes any unlawful rebate in violation of this article shall be liable to this State for five times the amount of any such commission or unlawful rebate, the amount thereof to be recovered by the commissioner as a general realization of this State, in addition to any other penalty imposed by law. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:20-125 Revocation or suspension of title insurer's certificate of authority.

§431:20-125 Revocation or suspension of title insurer's certificate of authority.
(a) The commissioner may after a hearing suspend or revoke the certificate of authority of any title insurer which:
(1) After ten days' written notice from the commissioner requiring it so to do, fails to print, display, and make available to the public its schedule of fees and charges in the manner provided in section 431:20-120.
(2) After ten days' written notice from the commissioner requiring it to cease and desist, continues to pay any commission or to make any rebate in wilful violation of section 431:20-118.
(b) The hearings shall be conducted in accordance with section 431:20-103(3) and the commissioner shall have all the powers granted therein. [L 1987, c 347, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:21-101 Purpose.

Cross References
Hawaii hurricane relief fund, see chapter 431P.
§431:21-101 Purpose.
The purpose of this article is to establish the Hawaii Property Insurance Association to:
(1) Assure stability in the property insurance market for property located in the State;
(2) Assure the availability of basic property insurance as defined by this article; and
(3) Provide for the equitable distribution among member insurers of the responsibility for insuring qualified property for which basic property insurance cannot be obtained through the authorized insurers. [L 1991, c 284, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:21-102 Definitions.

§431:21-102 Definitions.
As used in the article:
"Association" means the Hawaii Property Insurance Association created under section 431:21-103.
"Basic property insurance" means insurance against direct loss to real or tangible personal property from perils insured under the standard fire policy and extended coverage endorsement.
"Member insurer" means any person who is authorized to transact property or casualty insurance in this State and is not engaged only in writing motor vehicle insurance under section 431:10C-106.
"Net direct written premiums" means the premiums taxable pursuant to section 431:7-202(a) for policies of property and casualty insurance. [L 1991, c 284, pt of §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:21-103 Creation of association.

§431:21-103 Creation of association.
(a) There is created a nonprofit unincorporated legal entity to be known as the Hawaii Property Insurance Association. All insurers included in the definition of member insurer in section 431:21-102 shall be and remain members of the association as a condition of their authority to transact the business of insurance in this State. The association shall perform its functions under a plan of operation established and approved under section 431:21-106 and shall exercise its powers through a board of directors established under section 431:21-104.
(b) Each member insurer shall participate in the writings, expenses, profits, and losses of the association in the proportion that its net direct written premiums during the preceding calendar year bear to the net direct written premiums for all member insurers for the preceding calendar year. [L 1991, c 284, pt of §2; am L 1992, c 143, §2]
2023 Hawaii Revised Statutes › Title 24. Insurance › 431. Insurance Code › 431:21-104 Board of directors.

§431:21-104 Board of directors.
(a) The board of directors shall have responsibility and control over the organization, management, policies, and activities of the association. The board of directors of the association shall consist of twelve persons serving terms as established in the plan of operation. The board shall be composed of:
(1) Eight voting members selected by the member insurers;
(2) One voting member appointed by the commissioner to represent insurance producers; and
(3) Three voting members appointed by the commissioner to represent the public.
(b) The commissioner shall appoint the initial members of the board of directors. All member insurers shall be fairly represented on the board.
(c) Members of the board may be reimbursed from the assets of the association for reasonable expenses incurred by them as members of the board of directors. [L 1991, c 284, pt of §2; am L 1992, c 143, §3; am L 1994, c 128, §9; am L 1996, c 99, §2; am L 2003, c 212, §118]