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2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5507 - Nonadmitted insurer; personal jurisdiction.

44-5507.
Nonadmitted insurer; personal jurisdiction.
Every nonadmitted insurer accepting business under the Surplus Lines Insurance Act shall be held to have sufficient contact with this state for the exercise of personal jurisdiction over such insurer (1) upon any cause of action arising out of any such transaction or (2) in any proceeding before the director under the act.
Source
Laws 1913, c. 154, § 25, p. 410;
R.S.1913, § 3161;
Laws 1919, c. 190, tit. V, art. III, § 18, p. 589;
C.S.1922, § 7762;
C.S.1929, § 44-218;
R.S.1943, § 44-145;
Laws 1978, LB 836, § 5;
Laws 1983, LB 447, § 57;
R.S.1943, (1988), § 44-145;
Laws 1992, LB 1006, § 7;
Laws 2019, LB469, § 4.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5508 - Surplus lines licensee; requirements; duties of licensee; violations; penalty; nonadmitted insurer; requirements.

44-5508.
Surplus lines licensee; requirements; duties of licensee; violations; penalty; nonadmitted insurer; requirements.
(1) A surplus lines licensee shall not place coverage with a nonadmitted insurer unless, at the time of placement, the surplus lines licensee has determined that the nonadmitted insurer is a domestic surplus lines insurer or meets the following criteria:
(a) Is authorized to write such insurance in its domiciliary jurisdiction;
(b) Has established satisfactory evidence of good repute and financial integrity; and
(c)(i) Possesses capital and surplus or its equivalent under the laws of its domiciliary jurisdiction that equals the greater of the minimum capital and surplus requirements under the laws of this state or fifteen million dollars; or
(ii) If minimum capital and surplus does not meet the requirements of subdivision (1)(c)(i) of this section, then upon an affirmative finding of acceptability by the director. The finding shall be based upon such factors as quality of management, capital and surplus of any parent company, company underwriting profit and investment income trends, market availability, and company record and reputation within the industry. The director shall not make an affirmative finding of acceptability if the nonadmitted insurer's capital and surplus is less than four million five hundred thousand dollars.
(2) No surplus lines licensee shall place nonadmitted insurance with or procure nonadmitted insurance from a nonadmitted insurer domiciled outside the United States unless the insurer is listed on the Quarterly Listing of Alien Insurers maintained by the International Insurers Department of the National Association of Insurance Commissioners.
(3) Any surplus lines licensee violating this section shall be guilty of a Class III misdemeanor.
(4)(a) No nonadmitted foreign or alien insurer shall accept business under the Surplus Lines Insurance Act if it does not comply with the surplus and capital requirements of subsection (1) of this section.
(b) In addition to the requirements of subdivision (a) of this subsection, no nonadmitted alien insurer shall accept business under the act if it does not comply with the requirements of subsection (2) of this section.
Source
Laws 1913, c. 154, § 26, p. 410;
R.S.1913, § 3162;
Laws 1919, c. 190, tit. V, art. III, § 19, p. 589;
C.S.1922, § 7763;
C.S.1929, § 44-219;
R.S.1943, § 44-147;
Laws 1951, c. 135, § 2, p. 558;
Laws 1971, LB 757, § 1;
Laws 1977, LB 40, § 230;
Laws 1978, LB 836, § 6;
Laws 1989, LB 92, § 33;
R.S.Supp.,1990, § 44-147;
Laws 1992, LB 1006, § 8;
Laws 1994, LB 978, § 31;
Laws 2005, LB 119, § 21;
Laws 2011, LB70, § 6;
Laws 2019, LB469, § 5.
Annotations
The procuring of insurance with nonexistent and spurious fire insurance companies violated this section. Naeve v. Shea, 132 Neb. 787, 273 N.W. 265 (1937).
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5509 - Surplus lines licensee; policy; information required.

44-5509.
Surplus lines licensee; policy; information required.
A surplus lines licensee shall stamp or type upon the declaration page of each policy procured and delivered under the Surplus Lines Insurance Act the following information: (1) The licensee's name, business address, and surplus lines license number; (2) the name under which the licensee transacts business if different than the licensee's own name; and (3) the language: This policy is issued by a nonadmitted insurer, and in the event of the insolvency of such insurer, this policy will not be covered by the Nebraska Property and Liability Insurance Guaranty Association.
Source
Laws 1978, LB 836, § 7;
Laws 1989, LB 92, § 34;
R.S.Supp.,1990, § 44-147.01;
Laws 1992, LB 1006, § 9.
Cross References
Nebraska Property and Liability Insurance Guaranty Association, see section 44-2404.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5510 - Insurance; procurement from nonadmitted insurer; when; terms and conditions; surplus lines licensee; exempt from due diligence search; conditions.

44-5510.
Insurance; procurement from nonadmitted insurer; when; terms and conditions; surplus lines licensee; exempt from due diligence search; conditions.
(1) If an applicant for insurance is unable to procure such insurance as he or she deems reasonably necessary to insure a risk or exposure from an admitted insurer, such insurance may be procured from a nonadmitted insurer upon the following terms and conditions:
(a) The insurance shall be procured from a surplus lines licensee;
(b) The insurance procured shall not include any insurance described in subdivisions (1) through (4) of section 44-201, except that this subdivision shall not prohibit the procurement of disability insurance that has a benefit limit in excess of any benefit limit available from an admitted insurer;
(c) Not later than thirty days after the effective date of such insurance, the insured shall provide, in writing, his or her permission for such insurance to be written in a nonadmitted insurer and his or her acknowledgment that, in the event of the insolvency of such insurer, the policy will not be covered by the Nebraska Property and Liability Insurance Guaranty Association; and
(d) Compliance with section 44-5511.
(2) A surplus lines licensee seeking to procure or place nonadmitted insurance for an exempt commercial purchaser whose home state is the State of Nebraska shall not be required to make a due diligence search to determine whether the full amount or type of insurance sought by such exempt commercial purchaser can be obtained from admitted insurers if:
(a) The surplus lines licensee procuring or placing the insurance has disclosed to the exempt commercial purchaser that such insurance may or may not be available from the admitted market that may provide greater protection with more regulatory oversight; and
(b) The exempt commercial purchaser has subsequently requested in writing the surplus lines licensee to procure or place such insurance for a nonadmitted insurer.
Source
Laws 1978, LB 836, § 8;
Laws 1989, LB 92, § 35;
R.S.Supp.,1990, § 44-147.02;
Laws 1992, LB 1006, § 10;
Laws 2011, LB70, § 7;
Laws 2012, LB1064, § 1.
Cross References
Nebraska Property and Liability Insurance Guaranty Association, see section 44-2404.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5511 - Surplus lines licensee; report; contents; when due.

44-5511.
Surplus lines licensee; report; contents; when due.
On or before March 1 for the quarter ending the preceding December 31, June 1 for the quarter ending the preceding March 31, September 1 for the quarter ending the preceding June 30, and December 1 for the quarter ending the preceding September 30 of each year, every surplus lines licensee shall file with the department a report containing such information as the department may require, including: (1) The name of the nonadmitted insurer; (2) the name of the licensee; (3) the number of policies issued by each nonadmitted insurer; (4) except for insurance placed or procured on behalf of an exempt commercial purchaser, a sworn statement by the licensee with regard to the coverages described in the quarterly report that, to the best of the licensee's knowledge and belief, the licensee could not reasonably procure such coverages from an admitted insurer; and (5) the premium volume for each nonadmitted insurer by line of business.
Source
Laws 1978, LB 836, § 9;
Laws 1989, LB 92, § 36;
R.S.Supp.,1990, § 44-147.03;
Laws 1992, LB 1006, § 11;
Laws 2011, LB70, § 8;
Laws 2018, LB799, § 1.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5512 - Violations; director; hearing; orders; penalty; appeal.

44-5512.
Violations; director; hearing; orders; penalty; appeal.
(1) Whenever the director has reason to believe that any person has engaged in any activities in violation of the Surplus Lines Insurance Act, the director may:
(a) Issue an order and notice of hearing directing such person to cease and desist from engaging in such activities; or
(b) Issue a statement of the charges of violation and a notice of hearing to be held within thirty days to determine whether or not such violation occurred.
(2) Any hearing held pursuant to subsection (1) of this section, and any appeal therefrom, shall be in accordance with the Administrative Procedure Act.
(3) If, after any hearing held pursuant to subsection (1) of this section, the director finds that the person charged has committed a violation as alleged, he or she shall reduce his or her findings to writing and serve a copy of the findings on the person charged and, in addition, the director may order any one or more of the following:
(a) That such person cease and desist from engaging in such activities;
(b) Payment of a fine of not more than five thousand dollars; and
(c) Suspension or revocation of any surplus lines license held by such person for such period of time as the director determines.
(4) Any person who violates a cease and desist order may, after notice and hearing and upon order of the director, be subject to:
(a) Payment of a fine of not more than ten thousand dollars; and
(b) Suspension or revocation of each insurance license held by such person for such period of time as the director determines.
(5) For purposes of this section, person shall include a nonadmitted insurer.
Source
Laws 1978, LB 836, § 10;
Laws 1989, LB 92, § 37;
R.S.Supp.,1990, § 44-147.04;
Laws 1992, LB 1006, § 12;
Laws 2018, LB799, § 2.
Cross References
Administrative Procedure Act, see section 84-920.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5514 - Rules and regulations.

44-5514.
Rules and regulations.
The director may adopt and promulgate rules and regulations to carry out the Surplus Lines Insurance Act.
Source
Laws 1978, LB 836, § 12;
Laws 1989, LB 92, § 38;
R.S.Supp.,1990, § 44-147.06;
Laws 1992, LB 1006, § 14.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5515 - Exempt commercial purchaser; taxes; form.

44-5515.
Exempt commercial purchaser; taxes; form.
Every exempt commercial purchaser whose home state is the State of Nebraska shall, on or before March 1 for the quarter ending the preceding December 31, June 1 for the quarter ending the preceding March 31, September 1 for the quarter ending the preceding June 30, and December 1 for the quarter ending the preceding September 30 of each year, pay to the department a tax in the amount required by subsection (2) of section 44-5506. The calculation of the taxes due pursuant to this section shall be based only on those premiums remitted for the placement or procurement of insurance by an exempt commercial purchaser whose home state is the State of Nebraska. The department shall prescribe a form for an exempt commercial purchaser tax filing.
Source
Laws 2007, LB117, § 24;
Laws 2011, LB70, § 9;
Laws 2016, LB837, § 2.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5601 - Act, how cited.

44-5601.
Act, how cited.
Sections 44-5601 to 44-5613 shall be known and may be cited as the Reinsurance Intermediary Act.
Source
Laws 1992, LB 1006, § 55;
Laws 2002, LB 1139, § 38.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5603.01 - Nonresident reinsurance intermediary license; reciprocal licensure; continuing education.

44-5603.01.
Nonresident reinsurance intermediary license; reciprocal licensure; continuing education.
(1) The director shall waive any requirements for a nonresident reinsurance intermediary license applicant with a valid license from the applicant's home state, except the requirements imposed by section 44-5603, if the applicant's home state awards nonresident licenses to residents of this state on the same basis.
(2) A nonresident reinsurance intermediary's satisfaction of any applicable home-state continuing education requirements, if any, for licensed insurance producers or reinsurance intermediaries shall constitute satisfaction of the continuing education requirements of this state if the home state of the reinsurance intermediary recognizes the satisfaction of its continuing education requirements imposed upon insurance producers or reinsurance intermediaries from this state on the same basis.
Source
Laws 2002, LB 1139, § 40.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5603.02 - Licensed reinsurance intermediary; consent to jurisdiction.

44-5603.02.
Licensed reinsurance intermediary; consent to jurisdiction.
A reinsurance intermediary, by accepting licensure in this state, is deemed to have consented to the jurisdiction of the director and of the courts of this state with respect to all activities conducted under the license and to have designated the director as its agent for service of process. Each licensed reinsurance intermediary shall furnish the director with the name and address of a designated contact resident of this state to whom notices or orders of the director or process affecting the reinsurance intermediary may be forwarded. The licensee shall promptly notify the director in writing of every change in its designated contact for service of process, and such changes shall not become effective until acknowledged by the director.
Source
Laws 2002, LB 1139, § 41.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5604 - Reinsurance; written authorization required; contents.

44-5604.
Reinsurance; written authorization required; contents.
Transactions between a reinsurance intermediary-broker and the insurer it represents in such capacity shall only be entered into pursuant to a written authorization specifying the responsibilities of each party. The authorization shall at a minimum provide that:
(1) The insurer may terminate the reinsurance intermediary-broker's authority at any time;
(2) The reinsurance intermediary-broker will render accounts to the insurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by or owing to the reinsurance intermediary-broker, and will remit all funds due to the insurer within thirty days of receipt;
(3) All funds collected for the insurer's account will be held by the reinsurance intermediary-broker in a fiduciary capacity in a bank which is a qualified United States financial institution;
(4) The reinsurance intermediary-broker will comply with section 44-5605;
(5) The reinsurance intermediary-broker will comply with the written standards established by the insurer for the cession or retrocession of all risks; and
(6) The reinsurance intermediary-broker will disclose to the insurer any relationship with any reinsurer to which business will be ceded or retroceded.
Source
Laws 1992, LB 1006, § 58.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5605 - Reinsurance intermediary-broker; records; requirements.

44-5605.
Reinsurance intermediary-broker; records; requirements.
For at least ten years after expiration of each contract of reinsurance transacted by a reinsurance intermediary-broker, the reinsurance intermediary-broker shall keep a complete record for each transaction showing:
(1) Type of contract, limits, underwriting restrictions, classes or risks, and territory;
(2) Period of coverage, including effective and expiration dates, cancellation provisions, and notice required of cancellation;
(3) Reporting and settlement requirements of balances;
(4) Rate used to compute the reinsurance premium;
(5) Names and addresses of assuming reinsurers;
(6) Rates of all reinsurance commissions, including the commissions on any retrocessions handled by the reinsurance intermediary-broker;
(7) Related correspondence and memoranda;
(8) Proof of placement;
(9) Details regarding retrocessions handled by the reinsurance intermediary-broker, including the identity of retrocessionaires and percentage of each contract assumed or ceded;
(10) Financial records, including premium and loss accounts; and
(11) When the reinsurance intermediary-broker procures a reinsurance contract on behalf of a ceding insurer:
(a) Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
(b) If placed through a representative of the assuming reinsurer other than an employee, written evidence that the assuming reinsurer has delegated binding authority to the representative.
The insurer shall have access to and the right to copy and audit all accounts and records maintained by the reinsurance intermediary-broker related to its business in a form usable by the insurer.
Source
Laws 1992, LB 1006, § 59.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5606 - Insurer; prohibited acts; copy of statement of financial condition; obtain.

44-5606.
Insurer; prohibited acts; copy of statement of financial condition; obtain.
(1) An insurer shall not engage the services of any person, firm, association, or corporation to act as a reinsurance intermediary-broker on its behalf unless such person, firm, association, or corporation is licensed as required by subsection (1) of section 44-5603.
(2) An insurer may not employ a person who is employed by a reinsurance intermediary-broker with which it transacts business unless such reinsurance intermediary-broker is under common control with the insurer and subject to the Insurance Holding Company System Act.
(3) An insurer shall annually obtain a copy of statements of the financial condition of each reinsurance intermediary-broker with which it transacts business.
Source
Laws 1992, LB 1006, § 60.
Cross References
Insurance Holding Company System Act, see section 44-2120.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5608 - Reinsurance intermediary-manager; prohibited acts.

44-5608.
Reinsurance intermediary-manager; prohibited acts.
A reinsurance intermediary-manager shall not:
(1) Cede retrocessions on behalf of the reinsurer, except that the reinsurance intermediary-manager may cede facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for such retrocessions. Such guidelines shall include a list of reinsurers with which such automatic agreements are in effect and, for each such reinsurer, the coverages and amounts or percentages that may be reinsured and commission schedules;
(2) Commit the reinsurer to participate in reinsurance syndicates;
(3) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of reinsurance for which he or she is appointed;
(4) Without prior approval of the reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions, that exceeds the lesser of an amount specified by the reinsurer or one percent of the reinsurer's policyholders surplus as of December 31 of the last complete calendar year;
(5) Collect any payment from a retrocessionaire or commit the reinsurer to any claim settlement with a retrocessionaire, without prior approval of the reinsurer. If prior approval is given, a report shall be promptly forwarded to the reinsurer;
(6) Jointly employ an individual who is employed by the reinsurer unless such reinsurance intermediary-manager is under common control with the reinsurer subject to the Insurance Holding Company System Act; or
(7) Appoint a sub-reinsurance-intermediary-manager.
Source
Laws 1992, LB 1006, § 62.
Cross References
Insurance Holding Company System Act, see section 44-2120.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5609 - Reinsurer; prohibited acts; requirements.

44-5609.
Reinsurer; prohibited acts; requirements.
(1) A reinsurer shall not engage the services of any person, firm, association, or corporation to act as a reinsurance intermediary-manager on its behalf unless such person, firm, association, or corporation is licensed as required by subsection (2) of section 44-5603.
(2) The reinsurer shall annually obtain a copy of statements of the financial condition of each reinsurance intermediary-manager which such reinsurer has engaged prepared by an independent certified public accountant in a form acceptable to the director.
(3) If a reinsurance intermediary-manager establishes loss reserves, the reinsurer shall annually obtain the opinion of an independent actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the reinsurance intermediary-manager. The opinion shall be in addition to any other required loss reserve certification.
(4) Binding authority for all retrocessional contracts or participation in reinsurance syndicates shall rest with an officer of the reinsurer who is not affiliated with the reinsurance intermediary-manager.
(5) Within thirty days of termination of a contract with a reinsurance intermediary-manager, the reinsurer shall provide written notification of such termination to the director.
(6) A reinsurer shall not appoint to its board of directors, any officer, director, employee, controlling shareholder, or subproducer of its reinsurance intermediary-manager. This subsection shall not apply to relationships governed by the Insurance Holding Company System Act or the Producer-Controlled Property and Casualty Insurer Act.
Source
Laws 1992, LB 1006, § 63.
Cross References
Insurance Holding Company System Act, see section 44-2120.
Producer-Controlled Property and Casualty Insurer Act, see section 44-5701.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5610 - Reinsurance intermediary; examination by director.

44-5610.
Reinsurance intermediary; examination by director.
A reinsurance intermediary shall be subject to examination by the director. The director shall have access to all books, bank accounts, and records of the reinsurance intermediary in a form usable to the director. The cost of examination shall be paid by the reinsurance intermediary in the manner provided in Chapter 44 for insurance companies.
Source
Laws 1992, LB 1006, § 64.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5611 - Violations; penalties; action for damages; act, how construed.

44-5611.
Violations; penalties; action for damages; act, how construed.
(1) If the director determines that the reinsurance intermediary or any other person has not materially complied with the Reinsurance Intermediary Act, any rule or regulation adopted and promulgated thereunder, or any order issued thereunder, after notice and opportunity to be heard in accordance with the Administrative Procedure Act, the director may:
(a) For each separate violation, order a penalty in an amount not exceeding five thousand dollars;
(b) Order revocation or suspension of the reinsurance intermediary's license; and
(c) If it was found that because of such material noncompliance that the insurer or reinsurer has suffered any loss or damage, maintain a civil action brought by or on behalf of the reinsurer or insurer and its policyholders and creditors for recovery of damages for the benefit of the reinsurer or insurer and its policyholders and creditors and other appropriate relief.
(2) If an order of rehabilitation or liquidation of the insurer has been entered pursuant to the Nebraska Insurers Supervision, Rehabilitation, and Liquidation Act, and the receiver appointed under the order determines that the reinsurance intermediary or any other person has not materially complied with the Reinsurance Intermediary Act, any rule and regulation adopted and promulgated thereunder, or any order issued thereunder, and the insurer suffered any loss or damage therefrom, the receiver may maintain a civil action for recovery of damages and other appropriate relief for the benefit of the insurer.
(3) This section shall not affect the right of the director to impose any other penalties provided for in Chapter 44.
(4) The Reinsurance Intermediary Act is not intended to and shall not in any manner limit or restrict the rights of policyholders, claimants, creditors, and other third parties.
Source
Laws 1992, LB 1006, § 65;
Laws 1993, LB 583, § 113.
Cross References
Administrative Procedure Act, see section 84-920.
Nebraska Insurers Supervision, Rehabilitation, and Liquidation Act, see section 44-4862.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5613 - Compliance with act; when.

44-5613.
Compliance with act; when.
No insurer or reinsurer may continue to utilize the services of a reinsurance intermediary on and after January 1, 1993, unless utilization is in compliance with the Reinsurance Intermediary Act.
Source
Laws 1992, LB 1006, § 67.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5702 - Terms, defined.

44-5702.
Terms, defined.
For purposes of the Producer-Controlled Property and Casualty Insurer Act:
(1) Accredited state shall mean a state in which the insurance department or regulatory agency has qualified as meeting the minimum financial regulatory standards established and promulgated from time to time by the National Association of Insurance Commissioners;
(2) Captive insurers shall mean insurance companies owned by another organization the exclusive purpose of which is to insure risks of the parent organization and affiliated companies or, in the case of groups and associations, insurance organizations owned by the insureds the exclusive purpose of which is to insure risks to member organizations or group members and their affiliates;
(3) Control or controlled shall have the same meaning as in section 44-2121;
(4) Controlled insurer shall mean an insurer which is controlled, directly or indirectly, by a producer;
(5) Controlling producer shall mean a producer which, directly or indirectly, controls an insurer;
(6) Director shall mean the Director of Insurance;
(7) Insurer shall mean any person, firm, association, or corporation holding a certificate of authority to transact property and casualty insurance business in this state. Insurer shall not include:
(a) Residual market pools and joint underwriting authorities or associations; and
(b) Captive insurers other than risk retention groups as defined in 15 U.S.C. 3901 et seq. and 42 U.S.C. 9671, as such sections existed on January 1, 2014; and
(8) Producer shall mean an insurance broker or any other person, firm, association, or corporation when, for any compensation, commission, or other thing of value, such person, firm, association, or corporation acts or aids in any manner in soliciting, negotiating, or procuring the making of any insurance contract on behalf of an insured other than the person, firm, association, or corporation.
Source
Laws 1992, LB 1006, § 69;
Laws 2014, LB700, § 17.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5703 - Applicability of act.

44-5703.
Applicability of act.
The Producer-Controlled Property and Casualty Insurer Act shall apply to insurers either domiciled in this state or domiciled in a state that is not an accredited state. All provisions of the Insurance Holding Company System Act, to the extent they are not superseded by the Producer-Controlled Property and Casualty Insurer Act, shall continue to apply to all parties within holding company systems subject to the Producer-Controlled Property and Casualty Insurer Act.
Source
Laws 1992, LB 1006, § 70.
Cross References
Insurance Holding Company System Act, see section 44-2120.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5705 - Notice to prospective insured; exception.

44-5705.
Notice to prospective insured; exception.
The controlling producer, prior to the effective date of the policy, shall deliver written notice to the prospective insured disclosing the relationship between the controlling producer and the controlled insurer, except that if the business is placed through a subproducer who is not a controlling producer, the controlling producer shall retain in his or her records a signed commitment from the subproducer that the subproducer is aware of the relationship between the controlled insurer and the controlling producer and that the subproducer has or will notify the insured.
Source
Laws 1992, LB 1006, § 72.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5706 - Enforcement of act; powers and duties; construction of section.

44-5706.
Enforcement of act; powers and duties; construction of section.
(1) If the director believes that the controlling producer or any other person has not materially complied with the Producer-Controlled Property and Casualty Insurer Act or any rule or regulation or order after notice and opportunity to be heard, the director may order the controlling producer to cease placing business with the controlled insurer. If it is found that because of such material noncompliance that the controlled insurer or any policyholder has suffered any loss or damage, the director may maintain a civil action or intervene in an action brought by or on behalf of the controlled insurer or policyholder for recovery of compensatory damages for the benefit of the controlled insurer or policyholder or other appropriate relief.
(2) If an order for liquidation or rehabilitation of the controlled insurer has been entered pursuant to the Nebraska Insurers Supervision, Rehabilitation, and Liquidation Act and the receiver appointed under the order believes that the controlling producer or any other person has not materially complied with the Producer-Controlled Property and Casualty Insurer Act or any rule or regulation or order and the controlled insurer suffered any loss or damage therefrom, the receiver may maintain a civil action for recovery of damages or other appropriate sanctions for the benefit of the controlled insurer.
(3) This section shall not affect the right of the director to impose any other penalties provided for in Chapter 44.
(4) This section is not intended to and shall not in any manner alter or affect the rights of policyholders, claimants, creditors, or other third parties.
Source
Laws 1992, LB 1006, § 73.
Cross References
Nebraska Insurers Supervision, Rehabilitation, and Liquidation Act, see section 44-4862.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5708 - Controlled insurers and controlling producers; compliance with act; when.

44-5708.
Controlled insurers and controlling producers; compliance with act; when.
Controlled insurers and controlling producers who are not in compliance with section 44-5704 on January 1, 1993, shall have until March 1, 1993, to come into compliance and shall comply with section 44-5705 beginning with all policies written or renewed on or after March 1, 1993.
Source
Laws 1992, LB 1006, § 75.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5803 - Third-party administrator; written agreement; requirements; suspension during dispute.

44-5803.
Third-party administrator; written agreement; requirements; suspension during dispute.
(1) No third-party administrator shall act as such without a written agreement between the third-party administrator and the insurer, and such written agreement shall be retained as part of the official records of both the insurer and the third-party administrator for the duration of the agreement and for five years thereafter. The agreement shall contain all provisions required by the Third-Party Administrator Act except insofar as those provisions do not apply to the functions performed by the third-party administrator.
(2) The written agreement shall include a statement of duties which the third-party administrator is expected to perform on behalf of the insurer and the lines, classes, or types of insurance for which the third-party administrator is to be authorized to administer. The written agreement shall make provision with respect to underwriting or other standards pertaining to the insurance business underwritten by such insurer.
(3) The insurer or third-party administrator may, with written notice, terminate the written agreement for cause as provided in the written agreement. The insurer may suspend the underwriting authority of the third-party administrator during the pendency of any dispute regarding the cause for termination of the written agreement. The insurer shall fulfill any lawful obligations with respect to policies affected by the written agreement, regardless of any dispute between the insurer and the third-party administrator.
Source
Laws 1992, LB 1006, § 78.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5804 - Payments to third-party administrator; how construed.

44-5804.
Payments to third-party administrator; how construed.
If an insurer utilizes the services of a third-party administrator, the payment to the third-party administrator of any charges and premiums by or on behalf of any policyholder, contract holder, certificate holder, or subscriber shall be deemed to have been received by the insurer, and the payment of return of premiums or claim payments forwarded by the insurer to the third-party administrator shall not be deemed to have been paid to the policyholder, contract holder, certificate holder, subscriber, or claimant until the payment is received by the policyholder, contract holder, certificate holder, subscriber, or claimant. Nothing in this section shall limit any right of the insurer against the third-party administrator resulting from the failure of the third-party administrator to make payments to the insurer, policyholders, contract holders, certificate holders, subscribers, or claimants.
Source
Laws 1992, LB 1006, § 79.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5807 - Insurer; third-party administrator; responsibilities.

44-5807.
Insurer; third-party administrator; responsibilities.
(1) If an insurer utilizes the services of a third-party administrator, the insurer shall be responsible for determining the benefits, premium rates, underwriting criteria, and claims-payment procedures and for securing reinsurance, if any. The rules pertaining to these matters shall be provided, in writing, by the insurer to the third-party administrator. The responsibilities of the third-party administrator as to any of these matters shall be set forth in the written agreement between the third-party administrator and the insurer.
(2) It shall be the sole responsibility of the insurer to provide for competent administration of its programs.
(3) In cases when a third-party administrator administers benefits for more than one hundred certificate holders or subscribers on behalf of an insurer, the insurer shall, at least semiannually, conduct a review of the operations of the third-party administrator. At least one such review shall be an onsite audit of the operations of the third-party administrator.
Source
Laws 1992, LB 1006, § 82.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5808 - Funds collected; held in fiduciary capacity; accounting.

44-5808.
Funds collected; held in fiduciary capacity; accounting.
(1) All charges and premiums collected by a third-party administrator on behalf of or for an insurer or insurers and the return of premiums received from that insurer or insurers shall be held by the third-party administrator in a fiduciary capacity. Such funds shall be immediately remitted to the person or persons entitled to them or shall be deposited promptly in a fiduciary account established and maintained by the third-party administrator in a federally insured or state-insured financial institution. The written agreement between the third-party administrator and the insurer shall provide for the third-party administrator to periodically render an accounting to the insurer detailing all transactions performed by the third-party administrator pertaining to the insurance business underwritten by the insurer.
(2) If charges and premiums deposited in a fiduciary account have been collected on behalf of or for one or more insurers, the third-party administrator shall keep records clearly recording the deposits in and withdrawals from the fiduciary account on behalf of each insurer. The third-party administrator shall keep copies of all the records pertaining to such deposits and withdrawals and, upon request of an insurer, shall furnish the insurer with copies of the records.
(3) The third-party administrator shall not pay any claim by withdrawals from a fiduciary account in which charges and premiums are deposited. Withdrawals from such account shall be made as provided in the written agreement between the third-party administrator and the insurer. The written agreement shall address, but not be limited to, the following:
(a) Remittance to an insurer entitled to remittance;
(b) Deposit in an account maintained in the name of the insurer;
(c) Transfer to and deposit in a claims-paying account, with claims to be paid as provided for in subsection (4) of this section;
(d) Payment to a group policyholder or group contract holder for remittance to the insurer entitled to such remittance;
(e) Payment to the third-party administrator of its commissions, fees, or charges; and
(f) Remittance of return of premium to the person or persons entitled to such return of premium.
(4) All claims paid by the third-party administrator from funds collected on behalf of or for an insurer shall be paid only on drafts or checks of and as authorized by the insurer.
Source
Laws 1992, LB 1006, § 83.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5809 - Certain contingency agreements prohibited; exceptions.

44-5809.
Certain contingency agreements prohibited; exceptions.
A third-party administrator shall not enter into any agreement or understanding with an insurer in which the effect is to make the amount of the third-party administrator's commissions, fees, or charges contingent upon savings effected in the adjustment, settlement, and payment of losses covered by the insurer's obligations. This section shall not prohibit a third-party administrator from receiving performance-based compensation for providing hospital or other auditing services. This section shall not prohibit a third-party administrator from receiving compensation based on premiums or charges collected or the number of claims paid or processed.
Source
Laws 1992, LB 1006, § 84.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5810 - Notice to certificate holder or subscribers; identification and disclosure of collections.

44-5810.
Notice to certificate holder or subscribers; identification and disclosure of collections.
(1) If an insurer utilizes the services of a third-party administrator, the third-party administrator shall provide a written notice approved by the insurer to certificate holders or subscribers advising them of the identity of and relationship among the third-party administrator, the policyholder or contract holder, and the insurer.
(2) When a third-party administrator collects charges, the reason for collection of each item shall be identified to the policyholder or contract holder and each item shall be shown separately from any premium. Additional charges shall not be made for services to the extent the services have been paid for by the insurer.
(3) The third-party administrator shall disclose to the insurer all charges, fees, and commissions received in connection with the providing of administrative services for the insurer, including any fees or commissions paid by insurers providing reinsurance.
Source
Laws 1992, LB 1006, § 85.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5811 - Written communications; delivery.

44-5811.
Written communications; delivery.
Any policies, contracts, certificates, booklets, termination notices, or other written communications delivered by the insurer to the third-party administrator for delivery to policyholders, contract holders, certificate holders, or subscribers shall be delivered by the third-party administrator promptly after receipt of instructions from the insurer to deliver them.
Source
Laws 1992, LB 1006, § 86.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5813 - Application requirements; waiver; when.

44-5813.
Application requirements; waiver; when.
Upon request from a third-party administrator, the director may waive the application requirements of subsection (2) of section 44-5812 if the third-party administrator has a valid certificate of authority as a third-party administrator issued in a state which has requirements for third-party administrators that are at least as stringent as those contained in the Third-Party Administrator Act.
Source
Laws 1992, LB 1006, § 88.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5814 - Annual report; filing; contents; fee; failure to file; effect.

44-5814.
Annual report; filing; contents; fee; failure to file; effect.
(1) Each third-party administrator shall file an annual report for the preceding calendar year with the director on or before March 1 of each year or within such extension of time therefor as the director for good cause may grant. The annual report shall be in the form and contain such matters as the director prescribes and shall be verified by at least two officers of the third-party administrator.
(2) The annual report shall include the complete names and addresses of all insurers with which the third-party administrator had a written agreement during the preceding fiscal year.
(3) At the time of filing its annual report, the third-party administrator shall pay to the director a filing fee of two hundred dollars.
(4)(a) Within seven business days after the failure of a third-party administrator to comply with the requirements of this section, the director shall notify the third-party administrator of such failure.
(b) Subject to subdivision (4)(c) of this section, if a third-party administrator fails to comply with the requirements of this section and any rules and regulations adopted and promulgated under this section and any orders issued under this section:
(i) Such third-party administrator shall pay a fine of fifty dollars for each day thereafter such failure continues and the third-party administrator continues to transact any business of insurance; and
(ii) In addition to the fine required under subdivision (4)(b)(i) of this section, the director may suspend the certificate of authority of the third-party administrator until it has complied with the requirements of this section, any rules and regulations adopted and promulgated under this section, and any orders issued under this section. The director shall remit all such fines to the State Treasurer for distribution in accordance with Article VII, section 5, of the Constitution of Nebraska.
(c) For good and sufficient cause shown, the director may grant a reasonable extension of time not to exceed thirty days within which the annual report may be filed as required under this section without the fine required under subdivision (4)(b)(i) of this section and without any suspension authorized under subdivision (4)(b)(ii) of this section.
Source
Laws 1992, LB 1006, § 89;
Laws 2002, LB 1139, § 42;
Laws 2003, LB 216, § 17;
Laws 2021, LB21, § 6.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5902 - Purpose of act.

44-5902.
Purpose of act.
The purpose of the Insurers Examination Act is to provide an effective and efficient system for examining the activities, operations, financial condition, and affairs of all persons transacting the business of insurance in this state and all persons otherwise subject to the jurisdiction of the director. The provisions of the act are intended to enable the director to adopt a flexible system of examinations which directs resources as may be deemed appropriate and necessary for the administration of the insurance and insurance-related laws of this state.
Source
Laws 1993, LB 583, § 2.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5903 - Terms, defined.

44-5903.
Terms, defined.
For purposes of the Insurers Examination Act:
(1) Company shall mean any person engaging in or proposing or attempting to engage in any transaction or kind of insurance or surety business and any person or group of persons who may otherwise be subject to the administrative, regulatory, or taxing authority of the director;
(2) Department shall mean the Department of Insurance;
(3) Director shall mean the Director of Insurance;
(4) Examiner shall mean any individual having been appointed by the director to conduct an examination under the act;
(5) Insurer shall mean any person authorized to transact the business of insurance, including any fraternal benefit society, reciprocal exchange, advisory organization, assessment association, unincorporated mutual association, hospital or physicians mutual insurance association, and professional association mutual insurance company; and
(6) Person shall mean any individual, aggregation of individuals, trust, association, partnership, limited liability company, or corporation or any affiliate thereof.
Source
Laws 1993, LB 583, § 3;
Laws 1994, LB 884, § 62.
2023 Nebraska Revised Statutes › Chapter 44 - Insurance › 44-5904 - Authority, scope, and scheduling of examinations.

44-5904.
Authority, scope, and scheduling of examinations.
(1) The director or any of his or her examiners may conduct an examination under the Insurers Examination Act of any company incorporated in this state or in any other state or country admitted to or applying for admission to transact business in this state as often as the director in his or her sole discretion deems appropriate but shall at a minimum conduct an examination of every domestic insurer not less frequently than once every five years. In scheduling and determining the nature, scope, and frequency of the examination of a company, the director shall consider such matters as the results of financial statement analyses and ratios, changes in the company's management or ownership, actuarial opinions, reports of independent certified public accountants, the company's ability to meet and fulfill its obligations, the company's compliance with provisions of law, other facts relating to the company's business methods, the company's management and its dealings with its policyholders, and other criteria as set forth in the Examiners' Handbook adopted by the National Association of Insurance Commissioners and in effect when the director conducts an examination under this section.
(2) For purposes of completing an examination of any company under the act, the director may examine or investigate any person, or the business of any person, insofar as such examination or investigation is, in the sole discretion of the director, necessary or material to the examination of the company.
Source
Laws 1993, LB 583, § 4;
Laws 1998, LB 1035, § 12;
Laws 2009, LB192, § 9.