2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 6 - AGENTS, SOLICITORS AND ADMINISTRATORS (§§ 56-6-101 — 56-6-1407) › Part 1 - TENNESSEE INSURANCE PRODUCER LICENSING ACT OF 2002 (§§ 56-6-101 — 56-6-126) › Section 56-6-112 - License denial, nonrenewal, suspension or revocation

(a)
The commissioner may place on probation, suspend, revoke or refuse to issue or renew a license issued under this part or may levy a civil penalty in accordance with this section or take any combination of those actions, for any one (1) or more of the following causes:
(1)
Providing incorrect, misleading, incomplete or materially untrue information in the license application;
(2)
Violating any law, rule, regulation, subpoena or order of the commissioner or of another state's commissioner;
(3)
Obtaining or attempting to obtain a license through misrepresentation or fraud;
(4)
Improperly withholding, misappropriating or converting any moneys or properties received in the course of doing insurance business;
(5)
Intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance;
(6)
Having been convicted of a felony;
(7)
Having admitted or been found to have committed any insurance unfair trade practice or fraud;
(8)
Using fraudulent, coercive, or dishonest practices, or demonstrating incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this state or elsewhere;
(9)
Having an insurance producer license, or its equivalent, denied, suspended or revoked in any other state, province, district or territory;
(10)
Forging another's name to an application for insurance or to any document related to an insurance transaction;
(11)
Improperly using notes or any other reference material to complete an examination for an insurance license;
(12)
Knowingly directing any person to submit an application for health care benefits through the TennCare program at a time when the person is covered by a group policy or when the policy is being renewed, and then quoting a rate for a group health insurance policy if the insurance producer knows the person would otherwise have been eligible to participate or continue participation in the group policy;
(13)
Knowingly accepting insurance business from an individual who is not licensed;
(14)
Selling, soliciting or negotiating insurance for a company that is not authorized to transact the business of insurance in this state; and
(15)
Violating the unfair trade practices as enumerated in §
56-6-125
.
(b)
Any action by the commissioner to put on probation, suspend, revoke or deny the renewal of a license pursuant to this section shall be governed by the Uniform Administrative Procedures Act, compiled in title 4, chapter 5.
(c)
In the event that the action by the commissioner is to deny an application for a license, the commissioner shall notify the applicant and advise, in writing, the applicant of the denial of the applicant's application within thirty (30) days.
(d)
The license of a business entity may be suspended or revoked if the commissioner finds, after a hearing, that an individual licensee's violation was known or should have been known by one (1) or more of the partners, officers or managers acting on behalf of the partnership or corporation and the violation was neither reported to the commissioner nor corrective action taken.
(e)
The commissioner shall retain the authority to enforce this part and impose any penalty or remedy authorized by this part and this title against any person who is under investigation for or charged with a violation of this part or this title, even if the person's license has been surrendered or has lapsed by operation of law.
(f)
The commissioner may serve a notice or order in any action arising under this part by registered or certified mail to the insurance producer or applicant at the address of record in the files of the department. Notwithstanding any law to the contrary, service in the manner set forth in this subsection (f) shall be deemed to constitute actual service on the insurance producer or applicant.
(g)
If, after providing notice consistent with the process established by §
4-5-320(c)
, and providing the opportunity for a contested case hearing held in accordance with the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, the commissioner finds that any person required to be licensed, permitted, or authorized by the division of insurance pursuant to this chapter has violated any statute, rule or order, the commissioner may, at the commissioner's discretion, order:
(1)
The person to cease and desist from engaging in the act or practice giving rise to the violation;
(2)
Payment of a monetary penalty of not more than one thousand dollars ($1,000) for each violation, but not to exceed an aggregate penalty of one hundred thousand dollars ($100,000). This subdivision (g)(2) shall not apply where a statute or rule specifically provides for other civil penalties for the violation. For purposes of this subdivision (g)(2), each day of continued violation shall constitute a separate violation; and
(3)
The suspension or revocation of the person's license.
(h)
In determining the amount of penalty to assess under this section, the commissioner shall consider:
(1)
Whether the person could reasonably have interpreted such person's actions to be in compliance with the obligations required by a statute, rule or order;
(2)
Whether the amount imposed will be a substantial economic deterrent to the violator;
(3)
The circumstances leading to the violation;
(4)
The severity of the violation and the risk of harm to the public;
(5)
The economic benefits gained by the violator as a result of noncompliance;
(6)
The interest of the public; and
(7)
The person's efforts to cure the violation.
(i)
For purposes of determining whether to issue an insurance producer license to an individual pursuant to this part, the commissioner shall not consider the following offenses if the offense occurred more than ten (10) years before the date upon which an individual submits an application for a license:
(1)
A misdemeanor; or
(2)
A Class E felony of which the individual was charged, but not convicted.
Amended by 2022 Tenn. Acts, ch. 814, s 1, eff. 4/8/2022.
Acts 2002, ch. 798, § 13; 2008 , ch. 1192, §§ 4, 5; 2011 , ch. 90, §§ 4, 5.