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Alaska Statutes.

Title 21. Insurance

Chapter 27. Producers, Agents, Administrators, Brokers, Adjusters, and Managers

Section 560. Appointment of Insurance Producers as Brokers.

AS 21.27.560. Appointment of Insurance Producers as Brokers.

(a) A client who appoints an insurance producer as its broker in this state or relative to a subject resident, located, or to be performed in this state shall execute a written contract that specifically sets out the duties, functions, powers, authority, and compensation of the insurance producer, if the broker is compensated by a fee paid by the client or by a combination of a fee paid by a client and a commission paid by an insurer with which coverage has been placed. The written contract shall be kept in the permanent records of the insurance producer and be open to inspection by the director.

(b) The insurance producer may not knowingly accept payment of a premium for coverage until the coverage has been authorized by the insurer. This subsection does not apply to renewal of existing coverage placed by the insurance producer or to a premium deposit for the purchase of insurance. A premium deposit shall be returned to the client if coverage is not obtained within 10 working days.

(c) An insurance producer appointed as a client's broker may only receive compensation if the compensation is a

(1) fee that requires the insurance producer to offset or reimburse the client for the full amount of a commission earned by the insurance producer;

(2) combination of a fee paid by a client and a commission paid by an insurer with which coverage is placed that may offset or reimburse a client for all or part of a commission earned by the insurance producer if the amount of the commission is disclosed to the client; or

(3) commission paid by an insurer with which coverage has been placed.

(d) A contract between a client and an insurance producer may not be assigned in whole or in part by the insurance producer.

(e) An insurance producer appointed as a broker by a client may act as an appointed agent of an admitted insurer and may accept an application, bind coverage, and collect a premium from the client on behalf of the admitted insurer.

(f) A controlling insurance producer may not be appointed as a broker by a client in this state or relative to a subject resident, located, or to be performed in this state unless, in a form acceptable to the director, the controlling insurance producer has disclosed in writing to the client the relationship between the controlling insurance producer and the controlled insurer, each client has acknowledged receipt of the disclosure, and a copy of the acknowledged disclosure is maintained by the controlling insurance producer in its records. The records shall be available for inspection by the director.

(g) Money paid by a client to an insurance producer for insurance premiums shall be held by the insurance producer as a fiduciary.

(h) An insured shall be entitled to coverage or a return premium and the premium shall be considered received by the insurer if the premium payment made to the insurance producer was, at the time made, designated for specific coverage, and the insurer accepted or acknowledged coverage by issuing a policy binder or other evidence of temporary insurance, or the insurance producer received information from the insurer in the normal course of business that the insurance had been granted.

(i) Except as provided under (c) and (e) of this section, this section does not alter the common law of agency as applied to transactions under this title.

Note to HTML Version:

This version of the Alaska Statutes is current through December, 2004. The Alaska Statutes were automatically converted to HTML from a plain text format. Every effort has been made to ensure their accuracy, but this can not be guaranteed. If it is critical that the precise terms of the Alaska Statutes be known, it is recommended that more formal sources be consulted. For statutes adopted after the effective date of these statutes, see, Alaska State Legislature If any errors are found, please e-mail Touch N' Go systems at E-mail. We hope you find this information useful.

Last modified 9/3/2005