Minnesota Session Laws - 1984, Regular Session

  

                         Laws of Minnesota 1984 

                        CHAPTER 592-H.F.No. 1678 
           An act relating to commerce; clarifying identity 
          between federal savings and loan associations and 
          savings banks; clarifying annual statement filing 
          requirements; providing for the suspension of 
          authority of self-insurance entities or self-insurers; 
          modifying certain existing fees and providing certain 
          new fees; providing for the approval of certain life 
          insurance policies by the commissioner; transferring 
          certain duties of the commissioner of commerce to the 
          commissioner of revenue; establishing certain taxation 
          filing requirements; providing for agent license 
          renewals; authorizing the issuance of orders to show 
          cause relating to license revocations; clarifying 
          continuing education reporting requirements; modifying 
          certain insurance licensing dates; providing for the 
          service of process on foreign companies and 
          unauthorized insurers; removing the countersignature 
          requirement for certain bid bonds and insurance 
          policies; clarifying policy form filing requirements; 
          describing certain requirements for enrollment in the 
          comprehensive health insurance plan; increasing the 
          agents referral fee under the comprehensive health 
          insurance plan; providing for the use of health 
          insurance claim forms; providing for the use of fire 
          insurance binders; modifying the definitions of 
          "motorcycle," "motor vehicle," "policy," and "utility 
          vehicle" for purposes of automobile insurance 
          regulation; increasing certain liability coverage on 
          automobile insurance plan policies; providing for the 
          cancellation or nonrenewal of a policy; defining "plan 
          of reparation security"; clarifying certain ambiguous 
          provisions in the No-Fault Automobile Insurance Act; 
          requiring certain premium reports to be filed with the 
          commissioner; prohibiting discrimination based on sex 
          or marital status; modifying the expiration date of 
          adjuster's licenses; providing for the appointment of 
          the board of the compensation reinsurance association; 
          clarifying the powers of the commissioner regarding 
          audits of the compensation reinsurance association; 
          making various technical changes; providing remedies; 
          prescribing penalties; appropriating money; amending 
          Minnesota Statutes 1982, sections 47.27, subdivision 
          4; 47.29; 47.31; 47.32; 47.49, subdivision 4; 60A.13, 
          subdivision 6, and by adding a subdivision; 60A.15, 
          subdivisions 1, 2, 2a, 6, 8, 9, 10, and by adding 
          subdivisions; 60A.17, subdivisions 3, 5b, and by 
          adding a subdivision; 60A.18, subdivision 3; 60A.19, 
          subdivisions 4 and 8; 60A.199; 60A.21, subdivision 2; 
          60A.23, subdivision 5; 61A.02; 61A.03, by adding a 
          subdivision; 62A.025; 62E.14, subdivision 1; 62E.15, 
          subdivision 3; 65A.03; 65B.001, subdivision 4; 65B.06, 
          subdivision 2; 65B.14, subdivisions 2 and 3; 65B.16; 
          65B.19; 65B.43, subdivisions 2, 13, and by adding a 
          subdivision; 65B.55, subdivision 1; 67A.241, 
          subdivision 2; 69.021, subdivisions 1, 2, 3, and by 
          adding a subdivision; 69.58; 69.59; 72A.061, 
          subdivision 2; 72A.07; 72A.20, by adding a 
          subdivision; 72A.23, subdivision 1; 72B.04, 
          subdivisions 7 and 10; 79.10; 79.39; 176.181, 
          subdivision 2, and by adding a subdivision; 271.01, 
          subdivision 5; 299F.21; 299F.22; 299F.23; 299F.24; 
          299F.26, subdivisions 1 and 2; 424.165, subdivision 1; 
          and 574.32; Minnesota Statutes 1983 Supplement, 
          sections 60A.05; 60A.14, subdivision 1; 60A.15, 
          subdivision 12; 60A.17, subdivisions 1a, 1d, and 6c; 
          60A.1701, subdivisions 5, 10, and 11; 60A.198, 
          subdivision 3; 65A.01, subdivision 3; 65B.17, 
          subdivision 1; 69.011, subdivision 1; and 79.37; 
          proposing new law coded in Minnesota Statutes, 
          chapters 60A and 61A; repealing Minnesota Statutes 
          1982, sections 65B.15, subdivision 3; 65B.48, 
          subdivision 8; and 69.031, subdivision 6. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1982, section 47.27, 
subdivision 4, is amended to read: 
    Subd. 4.  "Federal savings and loan association" means an a 
savings association, savings and loan association or savings 
bank organized under that certain act of Congress known as The 
Home Owners Loan Act of 1933, and acts amendatory thereof. 
    Sec. 2.  Minnesota Statutes 1982, section 47.29, is amended 
to read: 
    47.29 [SAVINGS BANKS MAY CONVERT INTO FEDERAL SAVINGS AND 
LOAN ASSOCIATIONS.] 
    Subdivision 1.  Any savings bank organized and existing 
under and by virtue of the laws of this state, is hereby 
authorized and empowered, by a two-thirds vote of the entire 
board of trustees, at any regular or special meeting of said 
board duly called for that purpose to convert itself into 
federal savings and loan association whenever said conversion is 
authorized by any act of the Congress of the United States:  
Provided, that before any such conversion shall become final and 
complete, (a) the secretary of the savings bank shall cause 30 
days written notice of such intended conversion (which notice, 
before mailing, shall be submitted to and approved by the 
commissioner of banks commerce) to be mailed prepaid to each 
depositor, at their last known address, according to the records 
of the bank, and after such notice each depositor may, prior to 
the time the conversion becomes final and complete, on demand 
and without prior notice, withdraw the full amount of his 
deposit or such part thereof as he may request, and upon such 
withdrawal he shall receive interest to the date of withdrawal 
at the same rate last paid or credited by the bank, 
notwithstanding the provisions of any law, bylaws, rule or 
regulation to the contrary, and (b) that such conversion be 
approved in writing by the commissioner of banks commerce.  
    Subd. 2.  At any time after the expiration of the 30 day 
period specified in subdivision 1, clause (a), (which fact shall 
be evidenced by the secretary of the savings bank filing an 
affidavit to that effect with the commissioner of banks commerce 
and the secretary of state of this state), upon filing a copy of 
the federal charter, certified by the issuing federal agency 
with the secretary of state of this state, the secretary of 
state shall record said charter and certify that fact thereon, 
whereupon the conversion shall be final and complete and the 
savings bank shall at that time cease to be a savings bank 
supervised by this state, and shall thereafter be a federal 
savings and loan association.  
    Sec. 3.  Minnesota Statutes 1982, section 47.31, is amended 
to read: 
    47.31 [FEDERAL SAVINGS AND LOAN ASSOCIATION MAY CONVERT 
INTO SAVINGS BANK.] 
    When authorized by act of the Congress of the United 
States, any federal savings and loan association with its 
principal place of business in this state may convert itself 
into a savings bank pursuant to the laws of this state:  
Provided, (a) that the association complies with all 
requirements imposed for such conversion under the laws of the 
United States; (b) that the association complies with the 
requirements and procedure set forth in section 47.30, except 
that the procedure for obtaining original articles of 
incorporation of a savings bank shall be followed in lieu of the 
procedure for amending articles of incorporation and the 30 day 
period specified in section 47.30, subdivisions 4 and 5, shall 
begin on the day the organization meeting is held pursuant to 
section 300.025; and (c) that the commissioner of banks commerce 
approves such conversion in writing.  
    Sec. 4.  Minnesota Statutes 1982, section 47.32, is amended 
to read: 
    47.32 [CONVERTING INSTITUTION DEEMED CONTINUANCE; TRANSFER 
OF PROPERTY AND RIGHTS.] 
    Upon the conversion of any savings bank into a savings, 
building and loan association or into a federal savings and loan 
association, and of a savings, building and loan association or 
federal savings and loan association into a savings bank, the 
corporate existence of the converting savings bank or 
association shall not terminate, and the resulting association 
or savings bank shall be a continuance of the converting savings 
bank or association; and all the property of the converting 
savings bank or association (including its rights) shall by 
operation of law vest in the resulting association or savings 
bank as of the time when the conversion becomes final and 
complete, and all of the obligations of the converting savings 
bank or association become those of the resulting association or 
savings bank.  Actions and other judicial proceedings to which 
the converting savings bank or association is a party may be 
prosecuted and defended as if the conversion had not been made.  
    Sec. 5.  Minnesota Statutes 1982, section 49.47, 
subdivision 4, is amended to read: 
    Subd. 4.  [SAVINGS BANKS.] "Savings bank" means a savings 
bank on February 5, 1982 as defined in section 47.01.  
    Sec. 6.  Minnesota Statutes 1983 Supplement, section 
60A.05, is amended to read: 
    60A.05 [SUSPENSION OF AUTHORITY.] 
    Subdivision 1.  [COMPANIES.] If the commissioner believes, 
upon examination or other evidence, that a foreign or domestic 
insurance company is in an unsound condition or, if a life 
insurance company, that its actual funds are less than its 
liabilities, or that it is insolvent; or if a foreign or 
domestic insurance company has failed to comply with the law, or 
if it, its officers, or agents, refuse to submit to examination, 
or to perform any legal obligation in relation thereto, and he 
believes protection of the interests of policyholders, 
claimants, or the general public requires summary action, he may 
revoke or suspend all certificates of authority granted to it or 
its agents.  He shall cause notification of his action to be 
published in a newspaper authorized to publish annual statements 
of insurance companies, and no new business shall thereafter be 
done by it, or its agents, in this state while the default or 
disability continues, nor until its authority to do business is 
restored by the commissioner.  The revocation or suspension is 
effective ten days after notice to the company unless the ground 
for revocation or suspension relates only to the financial 
condition or soundness of the company or to a deficiency in its 
assets, in which case revocation and suspension is effective 
upon notice to the company.  The notice shall specify the 
particulars of the supposed violation.  The district court of 
any county, upon petition of the company, shall summarily hear 
and determine the question whether the ground for revocation or 
suspension exists.  The court shall make any proper order or 
decree and enforce it by any appropriate process.  If the order 
or decree is adverse to the petitioning company, an appeal may 
be taken as in other civil cases.  In the case of appeal, the 
commissioner may issue his order revoking the right of the 
petitioning company to do business in this state until the final 
determination of the question.  Neither this section nor any 
proceedings under it shall affect any criminal prosecutions or 
proceeding for the enforcement of any fine, penalty, or 
forfeiture.  
    Subd. 2.  [SELF-INSURANCE ENTITIES.] The authority granted 
pursuant to chapter 62H and sections 65B.48, 176.181, 471.617, 
and 471.982 or any other law of the state of Minnesota to form 
self-insurance entities or otherwise act as a self-insurer 
immediately terminates upon any filing to commence bankruptcy 
proceedings in regard to the self-insurance entity or 
self-insurer without further action by the commissioner.  
    Sec. 7.  Minnesota Statutes 1982, section 60A.13, is 
amended by adding a subdivision to read: 
    Subd. 1a.  In addition, on or before March 1 of each year, 
an insurance company, including fraternal beneficiary 
associations and reciprocal exchanges, doing business in 
Minnesota shall file with the commissioner of revenue a copy of 
the annual statement required by subdivision 1.  A company that 
fails to file a copy of the statement with the commissioner is 
subject to the penalties in section 72A.061.  
    Sec. 8.  Minnesota Statutes 1982, section 60A.13, 
subdivision 6, is amended to read: 
    Subd. 6.  [COMPANY OR AGENT CANNOT CONTINUE BUSINESS UNLESS 
STATEMENT IS FILED.] No company or agent thereof shall transact 
any new business in this state after May thirty-first in any 
year unless it shall have previously transmitted the its annual 
statement to the commissioner and filed the a copy of its 
statement with the National Association of Insurance 
Commissioners with the required filing fee.  The commissioner 
may by order annually require that each insurer pay the required 
fee to the National Association of Insurance Commissioners for 
the filing of annual statements, but the fee shall not be more 
than 50 percent greater than the fee set by the National 
Association of Insurance Commissioners on January 1, 1984.  The 
fee shall be based on the relative premium volume of each 
insurer.  The commissioner's order shall not be subject to 
chapter 14.  
    Sec. 9.  Minnesota Statutes 1983 Supplement, section 
60A.14, subdivision 1, is amended to read: 
    Subdivision 1.  [FEES OTHER THAN EXAMINATION FEES.] In 
addition to the fees and charges provided for examinations, the 
following fees must be paid to the commissioner for deposit in 
the general fund: 
    (a) by township mutual fire insurance companies: 
    (1) for filing certificate of incorporation $25 and 
amendments thereto, $10; 
    (2) for filing annual statements, $15; 
    (3) for each annual certificate of authority, $15; 
    (4) for filing bylaws $25 and amendments thereto, $10. 
    (b) by other domestic and foreign companies including 
fraternals and reciprocal exchanges: 
    (1) for filing certified copy of certificate of articles of 
incorporation, $50; 
    (2) for filing annual statement, $30; 
    (3) for filing certified copy of amendment to certificate 
or articles of incorporation, $50; 
    (4) for filing bylaws, $25 or amendments thereto, $10; 
     (5) for each company's certificate of authority, $40, 
annually. 
     (c) the following general fees apply: 
     (1) for each certificate, including certified copy of 
certificate of authority, renewal, valuation of life policies, 
corporate condition or qualification, $5; 
     (2) for each copy of paper on file in the commissioner's 
office 50 cents per page, and $2.50 for certifying the same; 
     (3) for license to procure insurance in unadmitted foreign 
companies, $40; 
     (4) for receiving and forwarding each notice, proof of 
loss, summons, complaint or other process served upon the 
commissioner of insurance, as attorney for service of process 
upon any nonresident agent or insurance company, including 
reciprocal exchanges, $15 plus the cost of effectuating service 
by certified mail, which amount must be paid by the party 
serving the notice and may be taxed as other costs in the action;
    (5) for valuing the policies of life insurance companies, 
one cent per one thousand dollars of insurance so valued.  The 
commissioner may, in lieu of a valuation of the policies of any 
foreign life insurance company admitted, or applying for 
admission, to do business in this state, accept a certificate of 
valuation from the company's own actuary or from the 
commissioner of insurance of the state or territory in which the 
company is domiciled; 
    (6) for receiving and filing certificates of policies by 
the company's actuary, or by the commissioner of insurance of 
any other state or territory, $50; 
    (7) for issuing an initial license to an individual agent, 
$20 per license, for issuing an initial agent's license to a 
partnership or corporation, $50, and for issuing an amended or 
duplicate amendment (variable annuity) to a license, $25 $20, 
and for renewal of amendment, $20;  
    (8) for an application, examination, or re-examination for 
one class of license, $15 and an additional $15 for an 
application, examination, or re-examination for the second class 
of license;  
    (9) for each appointment of an agent filed with the 
commissioner, a domestic insurer shall remit $5 and all other 
insurers shall remit $3;  
    (10) (9) for renewing an individual agent's license, $20 
per year per license, and for renewing a license issued to a 
corporation or partnership, $50 per year;  
    (11) (10) for issuing and renewing a surplus lines agent's 
license, $500 $150;  
     (11) for issuing duplicate licenses, $5; 
     (12) for issuing licensing histories, $10; 
    (13) for processing checks returned due to insufficient 
funds, $15;  
    (14) for filing forms and rates, $10 per filing.  The 
commissioner shall adopt rules to define filings that are 
subject to a fee. 
    Sec. 10.  Minnesota Statutes 1982, section 60A.15, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DOMESTIC AND FOREIGN COMPANIES OTHER THAN 
TOWN AND FARMERS' MUTUAL AND DOMESTIC MUTUALS OTHER THAN LIFE.] 
On or before April 15, June 15, and December 15 of each year 
following December 31, 1971, every domestic and foreign company, 
except town and farmers' mutual insurance companies and domestic 
mutual insurance companies other than life, shall pay to the 
state treasurer through the commissioner of insurance revenue 
installments equal to one-third of the insurer's total estimated 
tax for the current year based on a sum equal to two percent of 
the gross premiums less return premiums on all direct business 
received by it in this state, or by its agents for it, in cash 
or otherwise, during such year, excepting premiums written for 
marine insurance as specified in subdivision 6.  If unpaid by 
such dates penalties of ten percent shall accrue thereon, and 
thereafter such sum and penalties shall draw interest at the 
rate of one percent per month until paid.  Failure of a company 
to make payments of at least one-third of either (a) the total 
tax paid during the previous calendar year or (b) 80 percent of 
the actual tax for the current calendar year shall subject the 
company to the penalty and interest provided in this subdivision.
    Sec. 11.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [ADDITION TO THE TAX.] In case of any 
underpayment of installments by an insurer, there shall be added 
to the tax for the taxable year an amount determined at the rate 
specified in section 270.75 upon the amount of underpayment.  
    Sec. 12.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 1b.  [AMOUNT OF UNDERPAYMENT.] For purposes of 
subdivision 1a, the amount of the underpayment shall be the 
excess of:  (1) the amount of the installment; over (2) the 
amount, if any, of the installment paid on or before the last 
date prescribed for payment.  
    Sec. 13.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [PERIOD OF UNDERPAYMENT.] The period of the 
underpayment shall run from the date the installment was 
required to be paid to whichever of the following dates is the 
earlier:  
    (1) on March 1 following the close of the taxable year;  
    (2) with respect to any portion of the underpayment, the 
date on which that portion is paid.  For purposes of this 
clause, a payment of estimated tax on any installment date shall 
be considered a payment of any previous underpayment only to the 
extent the payment exceeds the amount of the installment 
determined under subdivision 1c, clause (1) for the installment 
date.  
    Sec. 14.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 1d.  [DEFINITION OF TAX.] The term "tax" means the 
tax imposed by chapter 60A.  
    Sec. 15.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 1e.  [FAILURE TO FILE AN ESTIMATE.] In the case of an 
insurer which fails to file an estimated tax for a taxable year 
when one is required, the period of the underpayment shall run 
from the installment dates as set forth in subdivision 1 or 2 to 
whichever of the periods set forth in subdivision 1c is the 
earlier.  
    Sec. 16.  Minnesota Statutes 1982, section 60A.15, 
subdivision 2, is amended to read: 
    Subd. 2.  [DOMESTIC MUTUAL INSURANCE COMPANIES.] On or 
before April 15, June 15, September 15 and December 15 of each 
year following December 31, 1971, every domestic mutual 
insurance company including township and farmers' insurance 
companies shall pay to the state treasurer through the 
commissioner of insurance revenue quarterly installments of the 
insurer's total estimated tax for the current year based on a 
sum equal to two percent of the gross direct fire, lightning, 
and sprinkler leakage premiums, less return premiums on all 
direct business, except auto and ocean marine fire business 
received by it, or by its agents for it, in cash or otherwise, 
on property located in this state, during such year.  If unpaid 
by such dates penalties of ten percent shall accrue thereon, and 
thereafter such sum and penalties shall draw interest at the 
rate of one percent per month until paid, there shall be added 
to the tax for the taxable year an amount determined pursuant to 
subdivisions 1a to 1c.  Failure of a company to make quarterly 
payments of at least one-fourth of either (a) the total tax paid 
during the previous calendar year or (b) 80 percent of the 
actual tax for the current calendar year shall subject the 
company to the penalty and interest provided in this subdivision.
    Sec. 17.  Minnesota Statutes 1982, section 60A.15, 
subdivision 2a, is amended to read: 
    Subd. 2a.  [PROCEDURE FOR FILING AND ADJUSTMENT OF 
STATEMENTS AND TAXES.] (a) Payment of premium taxes for 1971 
shall be paid in two installments.  Every insurer subject to 
premium tax in this state shall make and file a statement of 
estimated premium tax on or before July 1, 1971.  Failure of a 
company to make payment on July 1, 1971, of at least one-half of 
either (a) the total tax paid during the previous calendar year 
or (b) 80 percent of the actual tax for the current calendar 
year shall subject the company to the penalty and interest 
provided in subdivisions 1 and 2.  The second installment shall 
be due on March 1, 1972, and shall be subject to the provisions 
of clauses (c) and (d) of this subdivision.  
    (b) Every insurer required to pay a premium tax in this 
state shall make and file a statement of estimated premium taxes 
for the period covered by the installment tax payment.  Such 
statement shall be in the form prescribed by the commissioner of 
revenue. 
    (c) (b) On or before March 1, annually every insurer 
subject to taxation under section 60A.15 shall make an annual 
return for the preceding calendar year setting forth such 
information as the commissioner of revenue may reasonably 
require on forms prescribed by him. 
    (d) (c) On March 1, the insurer shall pay any additional 
amount due for the preceding calendar year; if there has been an 
overpayment, such overpayment may be credited without interest 
on the estimated tax due April 15. 
    (d) If unpaid by this date penalties and interest as 
provided in section 290.53, subdivision 1, shall be imposed.  
    Sec. 18.  Minnesota Statutes 1982, section 60A.15, 
subdivision 6, is amended to read: 
    Subd. 6.  [MARINE INSURANCE COMPANIES.] Every domestic and 
foreign company shall pay to the state treasurer commissioner of 
revenue on or before June 1 annually a sum equal to five percent 
of its taxable underwriting profit, ascertained as hereinafter 
provided, with respect to all insurance written within this 
state, during the preceding calendar year, upon hulls, freights, 
or disbursements, or upon goods, wares, merchandise and all 
other personal property and interests therein, in course of 
exportation from, importation into any country, or 
transportation coastwise, including transportation by land or 
water from point of origin to final destination in respect to, 
appertaining to, or in connection with, any and all risks or 
perils of navigation, transit or transportation, and while being 
prepared for, and while awaiting shipment, and during any 
delays, storage, transshipment or reshipment incident thereto, 
including war risks and marine builder's risks.  If unpaid by 
such date a penalty of ten percent shall accrue thereon, and 
thereafter such sum and penalty shall draw interest at the rate 
of one percent per month until paid, penalties and interest as 
provided by section 290.53, subdivision 1, shall be imposed. 
    The underwriting profit on such insurance written within 
this state shall be that proportion of the total underwriting 
profit of such insurer from such insurance written within the 
United States which the amount of net premiums of such insurer 
from such insurance written within this state bears to the 
amount of net premiums of such insurer from such insurance 
written within the United States. 
    The underwriting profit of such insurer on such insurance 
written within the United States shall be determined by 
deducting from the net earned premiums on such marine insurance 
written within the United States during the taxable year, 
meaning thereby the calendar year next preceding the date on 
which such tax is due, the following items: 
    (a) Net losses incurred, meaning gross losses incurred 
during such calendar year under such marine insurance contracts 
written within the United States, less reinsurance claims 
collected or collectible and less net salvages or recoveries 
collected or collectible from any source applicable to the 
corresponding losses under such contracts; 
    (b) Net expenses incurred in connection with such marine 
contracts, including all state and federal taxes in connection 
therewith; but in no event shall the aggregate amount of such 
net expenses deducted exceed forty percent of the net premiums 
on such marine insurance contracts, ascertained as hereinafter 
provided; and 
    (c) Net dividends paid or credited to policyholders on such 
marine insurance contracts. 
    In determining the amount of such tax, net earned premiums 
on such marine insurance contracts written within the United 
States during the taxable year shall be arrived at as follows: 
    From gross premiums written on such contracts during the 
taxable year deduct any and all return premiums, premiums on 
policies not taken, premiums paid for reinsurance of such 
contracts and net unearned premiums on all such outstanding 
contracts at the end of the taxable year; and add to such amount 
net unearned premiums on such outstanding marine insurance 
contracts at the end of the calendar year next preceding the 
taxable year. 
    In determining the amount of such tax, net expenses 
incurred shall be determined as the sum of the following: 
    (d) Specific expenses incurred on such marine insurance 
business, consisting of all commissions, agency expenses, taxes, 
licenses, fees, loss adjustment expenses, and all other expenses 
incurred directly and specifically in connection with such 
business, less recoveries or reimbursements on account of or in 
connection with such commissions or other expenses collected or 
collectible because of reinsurance or from any other source. 
    (e) General expenses incurred on such marine insurance 
business, consisting of that proportion of general or overhead 
expenses incurred in connection with such business which the net 
premiums on such marine insurance written during the taxable 
year bear to the total net premiums written by such insurer from 
all classes of insurance written by it during the taxable year.  
Within the meaning of this paragraph, general or overhead 
expenses shall include salaries of officers and employees, 
printing and stationery, all taxes of this state and of the 
United States, except as included in paragraph (d) last above, 
and all other expenses of such insurer, not included in 
paragraph (d) last above, after deducting expenses specifically 
chargeable to any or all other classes of insurance business. 
    In determining the amount of such tax, the taxable 
underwriting profit of such insurer on such marine insurance 
business written within this state, shall be ascertained as 
follows: 
    (f) In the case of every such insurer which has written any 
such business within this state during three calendar years 
immediately preceding the year in which such taxes were payable, 
the taxable underwriting profit shall be determined by adding or 
subtracting, as the case may be, the underwriting profit or loss 
on all such insurance written within the United States, 
ascertained as hereinbefore provided, for each of such three 
years, and dividing by three. 
    (g) In the case of every such insurer other than as 
specified in paragraph (f) last above, such taxable underwriting 
profit, if any, shall be the underwriting profit, if any, on 
such marine insurance business written within this state during 
the taxable year, ascertained as hereinbefore provided; but 
after such insurer has written such marine insurance business 
within this state during three calendar years, an adjustment 
shall be made on the three year average basis by ascertaining 
the amount of tax payable in accordance with paragraph (f) last 
above. 
    The tax hereinbefore provided shall be paid annually by 
every insurer authorized to do in this state the business of 
marine insurance during any one or more of the next preceding 
three calendar years, and the calendar year next preceding such 
June first shall be deemed the taxable year within the meaning 
of this section. 
    Every insurer liable to pay the tax hereinbefore provided 
shall, on or before the first day of June in each year, file 
with the state treasurer commissioner of revenue a tax return in 
the form prescribed by him. 
    The tax provided for in this section shall apply to the 
business of the year ending December 31, 1952, and to subsequent 
years. 
    Sec. 19.  Minnesota Statutes 1982, section 60A.15, 
subdivision 8, is amended to read: 
    Subd. 8.  [EXAMINATION OF RETURNS; ASSESSMENTS; REFUNDS.] 
The commissioner of insurance revenue shall, as soon as 
practicable after a return required by this section is filed, 
examine the same and make any investigation or examination of 
the company's records and accounts that he may deem necessary 
for determining the correctness of the return.  The tax computed 
by him on the basis of such examination and investigation shall 
be the tax to be paid by such company.  If the tax found due 
shall be greater than the amount reported as due on the 
company's return, the commissioner shall assess a tax in the 
amount of such excess and the whole amount of such excess shall 
be paid to the state treasurer commissioner of revenue within 30 
60 days after notice of the amount and demand for its payment 
shall have been mailed to the company by the commissioner.  If 
the understatement of the tax on the return was false and 
fraudulent with intent to evade the tax, the installments of the 
tax shown by the company on its return which have not yet been 
paid shall be paid to the state treasurer within 30 days after 
notice of the amount thereof and demand for payment shall have 
been mailed to the company by the commissioner.  If the amount 
of the tax found due by the commissioner shall be less than that 
reported as due on the company's return, the excess shall be 
refunded to the company in the manner provided by subdivision 
12, (except that no demand therefor shall be necessary), if they 
have already paid the whole of such tax, or credited against any 
unpaid installment thereof; provided, that no refundment shall 
be made except as provided in subdivision 12, after the 
expiration of three and one-half years after the filing of the 
return. 
    If the commissioner examines returns of a company for more 
than one year, he may issue one order covering the several years 
under consideration reflecting the aggregate refund or 
additional tax due. 
    The notices and demands provided for by subdivisions 8 to 
10, shall be in such form as the commissioner may determine 
(including a statement) and shall contain a brief explanation of 
the computation of the tax and shall be sent by mail to the 
company at the address given in its return, if any, and if no 
such address is given, then to the last known address. 
    Sec. 20.  Minnesota Statutes 1982, section 60A.15, 
subdivision 9, is amended to read: 
    Subd. 9.  [FAILURE TO FILE RETURN, FALSE OR FRAUDULENT 
RETURN FILED.] If any company required by this section to file 
any return shall fail to do so within the time prescribed or 
shall make, wilfully willfully or otherwise, an incorrect, 
false, or fraudulent return, it shall, on the written demand of 
the commissioner of insurance revenue, file such return, or 
corrected return, within 30 60 days after the mailing of such 
written demand and at the same time pay the whole tax, or 
additional tax, due on the basis thereof.  If such company shall 
fail within that time to file such return, or corrected return, 
the commissioner shall make for it a return, or corrected 
return, from his own knowledge and from such information as he 
can obtain through testimony, or otherwise, and assess a tax on 
the basis thereof, which tax (less any payments theretofore made 
on account of the tax for the taxable year covered by such 
return) shall be paid within ten 60 days after the commissioner 
has mailed to such company a written notice of the amount 
thereof and demand for its payment.  Any such return or 
assessment made by the commissioner on account of the failure of 
the company to make a return, or a corrected return, shall be 
prima facie correct and valid, and the company shall have the 
burden of establishing its incorrectness or invalidity in any 
action or proceeding in respect thereto. 
    Sec. 21.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read:  
    Subdivision 9a.  [FAILURE TO FILE; PENALTIES AND INTEREST.] 
In case of any failure to make and file a return as required by 
this chapter within the time prescribed by law or prescribed by 
the commissioner of revenue in pursuance of law there shall be 
added to the tax penalties and interest as provided in section 
290.53, subdivision 2.  
    Sec. 22.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 9b.  [INTENT TO EVADE TAX; PENALTY.] If any company, 
with intent to evade the tax imposed by this chapter, fails to 
file any return required by this chapter or with such intent 
files a false or fraudulent return there shall also be imposed 
on it a penalty as provided in section 290.53, subdivision 3.  
    Sec. 23.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 9c.  [NEGLIGENCE OR INTENTIONAL DISREGARD; PENALTY.] 
If any part of any additional assessment is due to negligence or 
intentional disregard of the statute or a rule (but without 
intent to defraud), there shall be added to the tax a penalty as 
provided in section 290.53, subdivision 3a.  
    Sec. 24.  Minnesota Statutes 1982, section 60A.15, is 
amended by adding a subdivision to read: 
    Subd. 9d.  [CRIMINAL PROVISIONS.] In addition to the 
penalties hereinbefore prescribed, the provisions of section 
290.53, subdivision 4, shall apply to persons required by 
chapter 60A to make a return.  
    Sec. 25.  Minnesota Statutes 1982, section 60A.15, 
subdivision 10, is amended to read: 
    Subd. 10.  [COLLECTION OF TAX.] The tax required to be paid 
by this section may be collected in an ordinary action at law by 
the commissioner of insurance revenue against the company.  In 
any action commenced pursuant to this section, upon the filing 
of an affidavit of default, the clerk of the district court 
wherein the action was commenced shall enter judgment for the 
state for the amount demanded in the complaint together with 
costs and disbursements. 
    Sec. 26.  Minnesota Statutes 1983 Supplement, section 
60A.15, subdivision 12, is amended to read: 
    Subd. 12.  [OVERPAYMENTS, CLAIMS FOR REFUND.] (1) 
[PROCEDURE, TIME LIMIT, APPROPRIATION.] A company who has paid, 
voluntarily or otherwise, or from whom there has been collected 
an amount of tax for any year in excess of the amount legally 
due for that year, may file with the commissioner of insurance 
revenue a claim for a refund of the excess.  Except as provided 
in subdivision 11, no claim or refund shall be entertained 
unless filed within two years after the tax was paid or 
collected, or within 3-1/2 years from the filing of the return, 
whichever period is the longer allowed or made after 3-1/2 years 
from the date prescribed for filing the return (plus any 
extension of time granted for filing the return but only if 
filed within the extended time) or after two years from the date 
of overpayment, whichever period is longer, unless before the 
expiration of the period a claim is filed by the company.  For 
this purpose, a return or amended return claiming an overpayment 
constitutes a claim for refund. 
    Upon the filing of a claim, the commissioner shall examine 
it and shall make and file written findings denying or allowing 
the claim in whole or in part.  He shall mail a notice thereof 
to the company at the address stated upon the return.  If the 
claim is allowed in whole or in part, the commissioner shall 
issue his certificate for the refundment of the excess paid by 
the company, with interest at the rate of two six percent per 
annum computed from the date of the payment or collection of the 
tax until the date the refund is paid or the credit is made to 
the company.  The commissioner of finance shall pay the refund 
out of the proceeds of the taxes imposed by this section, as 
other state moneys are expended.  As much of the proceeds of the 
taxes as necessary are appropriated for that purpose. 
    (2) [DENIAL OF CLAIM, COURT PROCEEDINGS.] If the claim is 
denied in whole or in part, the company may commence an action 
against the commissioner to recover any overpayments of taxes 
claimed to be refundable for which the commissioner has issued 
no certificate of refundment commissioner shall mail an order of 
denial to the company in the manner prescribed in subdivision 
8.  An appeal from this order may be taken to the Minnesota tax 
court in the manner prescribed in section 271.06, or the company 
may commence an action against the commissioner to recover the 
denied overpayment.  The action may be brought in the district 
court of the district in the county of its principal place of 
business, or in the district court for Ramsey county.  The 
action may be commenced six months after the claim is filed if 
the commissioner has not then taken final action on it.  The 
action shall be commenced within 18 months after the notice of 
the order denying the claim in the district court must be 
commenced within 18 months following the mailing of the order of 
denial to the company.  If a claim for refund is filed by a 
company and no order of denial is issued within six months of 
the filing, the company may commence an action in the district 
court as in the case of a denial, but the action must be 
commenced within two years of the date that the claim for refund 
was filed. 
    (3) [DENIAL OF CLAIM, APPEAL.] Either party to the action 
may appeal as in other civil cases.  
    (4) [CONSENT TO EXTEND TIME.] If the commissioner and the 
company have, within the periods prescribed in clause (1), 
consented in writing to any extension of time for the assessment 
of the tax, the period within which a claim for refund may be 
filed, or a refund may be made or allowed, if no claim is filed, 
shall be the period within which the commissioner and the 
company have consented to an extension for the assessment of the 
tax and six months thereafter.  The period within which a claim 
for refund may be filed shall not expire prior to two years 
after the tax was paid. 
    (5) (4) [OVERPAYMENTS; REFUNDS.] If the amount determined 
to be an overpayment exceeds the taxes imposed by this section, 
the amount of excess shall be considered an overpayment.  An 
amount paid as tax constitutes an overpayment even if in fact 
there was no tax liability with respect to which the amount was 
paid. 
    Notwithstanding any other provision of law to the contrary, 
in the case of any overpayment, the commissioner, within the 
applicable period of limitations, shall refund any balance of 
more than one dollar to the company if the company requests the 
refund. 
    Sec. 27.  [60A.151] [PAYMENT OF TAX PENDING APPEAL.] 
    When a company appeals any tax liability assessed under the 
insurance laws of this state to the tax court and the amount in 
dispute is more than $6,000, the entire amount of the tax, 
penalty, and interest assessed by the commissioner must be paid 
at the time it is due unless permission to continue prosecution 
of the petition without payment is obtained.  The petitioner, 
upon ten days notice to the commissioner of revenue, may apply 
to the court for permission to continue prosecution of the 
petition without payment, and, if it is made to appear:  
    (1) that the proposed review is to be taken in good faith;  
    (2) that there is probable cause to believe that the 
company may be held exempt from the liability or that the 
liability may be determined to be less than 50 percent of the 
amount due; and 
    (3) that it would work a substantial hardship on the 
petitioner to pay the liability, 
the court may permit the petitioner to continue prosecution of 
the petition without payment, or may fix a lesser amount to be 
paid as a condition of continuing the prosection of the petition.
    Failure to make payment of the amount required when due 
operates automatically to dismiss the petition and all 
proceedings thereunder, unless the payment is waived by an order 
of the court permitting the petitioner to continue prosecution 
of the petition without payment.  
    Sec. 28.  Minnesota Statutes 1983 Supplement, section 
60A.17, subdivision 1a, is amended to read: 
    Subd. 1a.  [LICENSE APPLICATION.] (a) [PROCEDURE.] An 
application for a license to act as an insurance agent shall be 
made to the commissioner by the person who seeks to be licensed 
and shall be accompanied by a money order or cashier's check 
payable to the state treasurer for the amount of the examination 
fee prescribed by section 60A.14, subdivision 1, paragraph (c), 
clause (8).  All examination fees shall be nonrefundable.  The 
applicant shall have six months from the date of payment of the 
examination fee to take the exam.  The application for license 
shall be accompanied by a written appointment from an admitted 
insurer authorizing the applicant to act as its agent under one 
or both classes of license.  The insurer must also submit its 
check payable to the state treasurer for the amount of the 
appointment fee prescribed by section 60A.14, subdivision 1, 
paragraph (c), clause (9) at the time the agent becomes 
licensed.  The application and appointment shall be on forms 
prescribed by the commissioner.  
    If the applicant is a natural person, no license shall be 
issued until that natural person has become qualified.  
    If the applicant is a partnership or corporation, no 
license shall be issued until at least one natural person who is 
a partner, director, officer, stockholder, or employee shall be 
licensed as an insurance agent.  
    (b) [RESIDENT AGENT.] The commissioner shall issue a 
resident insurance agent's license to a qualified resident of 
this state as follows:  
      (1) A person may qualify as a resident of this state if 
that person resides in this state or the principal place of 
business of that person is maintained in this state.  
Application for a license claiming residency in this state for 
licensing purposes, shall constitute an election of residency in 
this state.  Any license issued upon an application claiming 
residency in this state shall be void if the licensee, while 
holding a resident license in this state, also holds, or makes 
application for, a resident license in, or thereafter claims to 
be a resident of, any other state or jurisdiction or if the 
licensee ceases to be a resident of this state; provided, 
however, if the applicant is a resident of a community or trade 
area, the border of which is contiguous with the state line of 
this state, the applicant may qualify for a resident license in 
this state and at the same time hold a resident license from the 
contiguous state;  
      (2) The commissioner shall subject each applicant who is a 
natural person to a written examination as to the applicant's 
competence to act as an insurance agent.  The examination shall 
be held at a reasonable time and place designated by the 
commissioner;  
      (3) The examination shall be approved for use by the 
commissioner and shall test the applicant's knowledge of the 
lines of insurance, policies, and transactions to be handled 
under the class of license applied for, of the duties and 
responsibilities of the licensee, and pertinent insurance laws 
of this state;  
      (4) The examination shall be given only after the applicant 
has completed a program of studies in a school, which shall 
include a school conducted by an admitted insurer, a 
correspondence course given by an admitted insurer, or other 
course of study.  The course of study shall consist of the 
equivalent of 45 hours study for each line for which a license 
application is made.  After January 1, 1982, the program of 
studies or study course shall have been approved by the 
commissioner in order to qualify under this clause.  If the 
applicant has been previously licensed for the particular line 
of insurance in the state of Minnesota, the requirement of a 
program of studies or a study course shall be waived.  A 
certification of compliance by an admitted insurer shall 
accompany the agent's license application.  This program of 
studies in a school or a study course shall not apply to farm 
property perils and farm liability applicants, or to agents 
writing such other lines of insurance as the commissioner may 
exempt from examination by order;  
      (5) The applicant must pass the examination with a grade 
determined by the commissioner to indicate satisfactory 
knowledge and understanding of the class or classes of insurance 
for which the applicant seeks qualification.  The commissioner 
shall inform the applicant as to whether or not the applicant 
has passed;  
      (6) An applicant who has failed to pass an examination may 
take subsequent examinations.  Examination fees for subsequent 
examinations shall not be waived; and 
      (7) Any applicant for a license covering the same class or 
classes of insurance for which the applicant was licensed under 
a similar license in this state, other than a temporary license, 
within the three years preceding the date of the application 
shall be exempt from the requirement of a written examination, 
unless the previous license was revoked or suspended by the 
commissioner.  
      (c) [NONRESIDENT AGENT.] The commissioner shall issue a 
nonresident insurance agent's license to a qualified person who 
is a resident of another state or country as follows:  
      (1) A person may qualify for a license under this section 
as a nonresident only if that person holds a license in another 
state, province of Canada, or other foreign country which, in 
the opinion of the commissioner, qualifies that person for the 
same activity as that for which a license is sought;  
      (2) The commissioner shall not issue a license to any 
nonresident applicant until that person files with the 
commissioner a designation of the commissioner and the 
commissioner's successors in office as the applicant's true and 
lawful attorney upon whom may be served all lawful process in 
any action, suit, or proceeding instituted by or on behalf of 
any interested person arising out of the applicant's insurance 
business in this state.  This designation shall constitute an 
agreement that this service of process is of the same legal 
force and validity as personal service of process in this state 
upon that applicant.  
      Service of process upon any licensee in any action or 
proceeding commenced in any court of competent jurisdiction of 
this state may be made by serving the commissioner with 
appropriate copies of the process along with payment of the fee 
pursuant to section 60A.14, subdivision 1, paragraph (c), clause 
(4).  The commissioner shall forward a copy of the process by 
registered or certified mail to the licensee at the last known 
address of record or principal place of business of the 
licensee; and 
     (3) A nonresident license shall terminate automatically 
when the resident license for that class of license in the 
state, province, or foreign country in which the licensee is a 
resident is terminated for any reason.  
     (d) [DENIAL.] (1) If the commissioner finds that an 
applicant for a resident or nonresident license has not fully 
met the requirements for licensing, the commissioner shall 
refuse to issue the license and shall promptly give written 
notice to both the applicant and the appointing insurer of the 
denial, stating the grounds for the denial.  All fees which 
accompanied the application and appointment shall be deemed 
earned and shall not be refundable.  
    (2) The commissioner may also deny issuance of a license 
for any cause that would subject the license of a licensee to 
suspension or revocation.  If a license is denied pursuant to 
this clause, the provisions of section 60A.17, subdivision 6c, 
paragraph (c) apply.  
    (3) The applicant may make a written demand upon the 
commissioner for a hearing within 30 days of the denial of a 
license to determine whether the reasons stated for the denial 
were lawful.  The hearing shall be held pursuant to chapter 14.  
    (e) [TERM.] All licenses issued pursuant to this section 
shall remain in force until voluntarily terminated by the 
licensee, not renewed as prescribed in section 60A.17, 
subdivision 1d, or until suspended or revoked by the 
commissioner.  A voluntary termination shall occur when the 
license is surrendered to the commissioner with the request that 
it be terminated or when the licensee dies, or when the licensee 
is dissolved or its existence is terminated.  In the case of a 
nonresident license, a voluntary termination shall also occur 
upon the happening of the event described in paragraph (c), 
clause (3).  
    Every licensed agent shall notify the commissioner within 
30 days of any change in address or change in state of residency 
of name, address, or information contained in the application. 
    (f) [SUBSEQUENT APPOINTMENTS.] A person who holds a valid 
agent's license from this state may solicit applications for 
insurance on behalf of an admitted insurer with which the 
licensee does not have a valid appointment on file with the 
commissioner; provided, that the licensee has permission from 
the insurer to solicit insurance on its behalf and, provided 
further, that the insurer upon receipt of the application for 
insurance submits a written notice of appointment to the 
commissioner accompanied by its check payable to the state 
treasurer in the amount of the appointment fee prescribed by 
section 60A.14, subdivision 1, paragraph (c), clause (9).  The 
notice of appointment shall be on a form prescribed by the 
commissioner.  
    (g) [AMENDMENT OF LICENSE.] An application to the 
commissioner to amend a license to reflect a change of name, or 
to include an additional class of license, or for any other 
reason, shall be on forms provided by the commissioner and shall 
be accompanied by the applicant's surrendered license and a 
money order or cashier's check payable to the state treasurer 
for the amount of fee specified in section 60A.14, subdivision 
1, paragraph (c), clause (7).  
    An applicant who surrenders an insurance license pursuant 
to this clause retains licensed status until an amended license 
is received.  
    (h) [EXCEPTIONS.] The following are exempt from the general 
licensing requirements prescribed by this section:  
    (1) Agents of township mutuals who are exempted pursuant to 
subdivision 1b;  
    (2) Fraternal beneficiary association representatives 
exempted pursuant to subdivision 1c;  
    (3) Any regular salaried officer or employee of a licensed 
insurer, without license or other qualification, may act on 
behalf of that licensed insurer in the negotiation of insurance 
for that insurer; provided that a licensed agent must 
participate in the sale of any such insurance;  
    (4) Employers and their officers or employees, and the 
trustees or employees of any trust plan, to the extent that the 
employers, officers, employees, or trustees are engaged in the 
administration or operation of any program of employee benefits 
for the employees of the employers or employees of their 
subsidiaries or affiliates involving the use of insurance issued 
by a licensed insurance company; provided, that the activities 
of the officers, employees and trustees are incidental to 
clerical or administrative duties and their compensation does 
not vary with the volume of insurance or applications therefor;  
    (5) Employees of a creditor who enroll debtors for life or 
accident and health insurance; provided the employees receive no 
commission or fee therefor; and 
    (6) Clerical or administrative employees of an insurance 
agent who take insurance applications or receive premiums in the 
office of their employer, if the activities are incidental to 
clerical or administrative duties and the employee's 
compensation does not vary with the volume of the applications 
or premiums.  
    Sec. 29.  Minnesota Statutes 1983 Supplement, section 
60A.17, subdivision 1d, is amended to read: 
    Subd. 1d.  [RENEWAL FEE.] (a) Each agent licensed pursuant 
to this section shall annually pay in accordance with the 
procedure adopted by the commissioner a renewal fee as 
prescribed by section 60A.14, subdivision 1, paragraph (c), 
clause (10).  
    (b) Every agent, corporation, and partnership license 
expires on May 31 of the year for which period a license is 
issued.  
    (c) Persons whose applications have been properly and 
timely filed who have not received notice of denial of renewal 
are approved for renewal and may continue to transact business 
whether or not the renewed license has been received on or 
before June 1.  Applications for renewal of a license are timely 
filed if received by the commissioner on or before May 15 of the 
year due, on forms duly executed and accompanied by appropriate 
fees.  An application mailed is considered timely filed if 
addressed to the commissioner, with proper postage, and 
postmarked by May 15.  
    (d) The commissioner may issue licenses for agents, 
corporations, or partnerships for a three-year period.  If 
three-year licenses are issued, the fee is three times the 
annual license fee.  
    Sec. 30.  Minnesota Statutes 1982, section 60A.17, 
subdivision 3, is amended to read: 
    Subd. 3.  [BROKERAGE BUSINESS.] Every insurance agent duly 
licensed to transact business in this state shall have the right 
to procure the insurance of risks, or parts of risks, in the 
class or classes of insurance for which he is licensed in other 
insurers duly authorized to transact business in this state, but 
such insurance shall only be consummated through a duly licensed 
appointed resident agent of the insurer taking the risk.  If the 
law of another state requires a non-resident agent who is a 
resident agent of Minnesota to pay a portion of the premium to 
or share commissions with a licensed resident agent of that 
state, then the licensed resident agent of Minnesota when 
consummating and countersigning for a licensed non-resident 
agent of that state shall receive five percent of the total 
premium or 25 percent of the commission, whichever is less. 
    Sec. 31.  Minnesota Statutes 1982, section 60A.17, 
subdivision 5b, is amended to read: 
    Subd. 5b.  [TERM OF APPOINTMENTS.] All appointments of 
agents by insurers pursuant to this section shall remain in 
force for one year unless sooner until terminated voluntarily by 
the appointing insurer or the license of the agent has for any 
reason been terminated during the appointment year.  The 
original appointing insurer, as well as any subsequent 
appointing insurer, may terminate their appointment of an agent 
at any time by giving written notice thereof to the commissioner 
and by sending a copy thereof to the last known address of the 
agent.  The effective date of the termination shall be the date 
of receipt of the notice by the commissioner unless another date 
is specified by the insurer in the notice.  Within 30 days after 
the insurer gives notice of termination to the commissioner, the 
insurer shall furnish the agent with a current statement of the 
agent's commission account.  
    Accompanying the notice of a termination given to the 
commissioner by the insurer shall be a statement of the specific 
reasons constituting the cause of termination.  Any document, 
record, or statement relating to the agent which is disclosed or 
furnished to the commissioner contemporaneously with, or 
subsequent to, the notice of termination shall be deemed 
confidential by the commissioner and a privileged 
communication.  The document, record, or statement furnished to 
the commissioner shall not be admissible in whole or in part for 
any purpose in any action or proceeding against (a) the insurer 
or any of its officers, employees, or representatives, 
submitting or providing the document, record or statement, or 
(b) any person, firm, or corporation furnishing in good faith to 
the insurer the information upon which the reasons for 
termination are based.  
     The agent may request of the commissioner and the 
commissioner shall disclose to the agent the specific reason or 
reasons for termination.  
    Sec. 32.  Minnesota Statutes 1982, section 60A.17, is 
amended by adding a subdivision to read: 
    Subd. 6d.  [SHOW CAUSE ORDERS.] If the commissioner 
determines that one of the conditions listed in subdivision 6c 
exists, the commissioner may issue an order requiring a licensee 
or an applicant for a license to show cause why the license 
should not be revoked or the application denied.  The order must 
be calculated to give reasonable notice of the time and place 
for hearing thereon, and must state the reasons for the entry of 
the order.  The commissioner may by order summarily suspend a 
license pending final determination of an order to show cause. 
If a license is suspended pending final determination of an 
order to show cause, a hearing on the merits must be held within 
30 days of the issuance of the order of suspension.  All 
hearings must be conducted in accordance with chapter 14.  After 
the hearing, the commissioner shall enter an order making a 
disposition of the matter as the facts require.  If the licensee 
or applicant fails to appear at a hearing of which he has been 
duly notified, the person is in default, and the proceeding may 
be determined against him upon consideration of the order to 
show cause, the allegations of which may be deemed to be true. 
The commissioner may adopt rules of procedure concerning all 
proceedings conducted pursuant to this subdivision.  
    Sec. 33.  Minnesota Statutes 1983 Supplement, section 
60A.17, subdivision 6c, is amended to read: 
    Subd. 6c.  [REVOCATION OR SUSPENSION OF LICENSE.] (a) The 
commissioner may by order suspend or revoke an insurance agent's 
or agency's license issued to a natural person or impose a civil 
penalty appropriate to the offense, not to exceed $5,000 upon 
that licensee, or both, if, after notice and hearing, the 
commissioner finds as to that licensee any one or more of the 
following conditions: 
    (1) any materially untrue statement in the license 
application; 
    (2) any cause for which issuance of the license could have 
been refused had it then existed and been known to the 
commissioner at the time of issuance; 
    (3) violation of, or noncompliance with, any insurance law 
or violation of any rule or order of the commissioner or of a 
commissioner of insurance of another state or jurisdiction; 
    (4) obtaining or attempting to obtain any license through 
misrepresentation or fraud; 
    (5) improperly withholding, misappropriating, or converting 
to the licensee's own use any moneys belonging to a 
policyholder, insurer, beneficiary, or other person, received by 
the licensee in the course of the licensee's insurance business; 
    (6) misrepresentation of the terms of any actual or 
proposed insurance contract; 
    (7) conviction of a felony or of a gross misdemeanor or 
misdemeanor involving moral turpitude; 
    (8) that the licensee has been found guilty of any unfair 
trade practice, as defined in chapters 60A to 72A, or of fraud; 
    (9) that in the conduct of the agent's affairs under the 
license, the licensee has used fraudulent, coercive, or 
dishonest practices, or the licensee has been shown to be 
incompetent, untrustworthy, or financially irresponsible; 
    (10) that the agent's license has been suspended or revoked 
in any other state, province, district, territory, or foreign 
country; 
    (11) that the licensee has forged another's name to an 
application for insurance; or 
    (12) that the licensee has violated subdivision 6b. 
    (b) The commissioner may by order suspend or revoke an 
insurance agent's or insurance agency's license issued to a 
partnership or corporation or impose a civil penalty not to 
exceed $5,000 upon that licensee, or both, if, after notice and 
hearing, the commissioner finds as to that licensee, or as to 
any partner, director, shareholder, officer, or employee of that 
licensee, any one or more of the conditions set forth in 
paragraph (a). 
    (c) A revocation of a license shall prohibit the licensee 
from making a new application for a license for at least one 
year.  Further, the commissioner may, as a condition of 
relicensure, require the applicant to file a reasonable bond for 
the protection of the citizens of this state, which bond shall 
be maintained by the licensee in full force for a period of five 
years immediately following issuance of the license, unless the 
commissioner at his or her discretion shall after two years 
permit the licensee to sooner terminate the maintenance filing 
of the bond. 
    (d) Whenever it appears to the commissioner that any person 
has engaged or is about to engage in any act or practice 
constituting a violation of chapter chapters 60A to 72A or of 
any rule or order of the commissioner: 
    (1) The commissioner may issue and cause to be served upon 
the person an order requiring the person to cease and desist 
from the violation.  The order shall give reasonable notice of 
the time and place of hearing and shall state the reasons for 
the entry of the order.  A hearing shall be held not later than 
seven days after the issuance of the order unless the person 
requests a delay.  After the hearing and within 30 days of 
filing of any exceptions to the hearing examiner's report, the 
commissioner shall issue an order vacating the cease and desist 
order or making it permanent as the facts require.  All hearings 
shall be conducted in accordance with the provisions of chapter 
14.  If the person to whom a cease and desist order is issued 
fails to appear at the hearing after being duly notified, the 
person shall be deemed in default, and the proceeding may be 
determined against the person upon consideration of the cease 
and desist order, the allegations of which may be deemed to be 
true; 
    (2) The commissioner may bring an action in the district 
court in the appropriate county to enjoin the acts or practices 
and to enforce compliance with chapter chapters 60A to 72A and 
any rule or order of the commissioner; and 
    (3) In any proceeding under chapter chapters 60A to 72A 
relating to injunction, the request for injunction may be 
brought on for hearing and disposition upon an order to show 
cause returnable upon not more than eight days notice to the 
defendant.  The case shall have precedence over other matters on 
the court calendar and shall not be continued without the 
consent of the state of Minnesota, except upon good cause shown 
to the court, and then only for a reasonable length of time as 
may be necessary in the opinion of the court to protect the 
rights of the defendant.  
    (e) The commissioner may, in the manner prescribed by 
chapter 14, impose a civil penalty not to exceed $5,000 upon a 
person whose licensed has lapsed, or been suspended, revoked, or 
otherwise terminated, for engaging in conduct prohibited by 
paragraph (a) before, during, or after the period of his or her 
licensure.  
    Sec. 34.  Minnesota Statutes 1983 Supplement, section 
60A.1701, subdivision 5, is amended to read: 
    Subd. 5.  [POWERS OF THE ADVISORY TASK FORCE.] (a) 
Applications for accreditation of each course must be submitted 
to the commissioner on forms prescribed by the commissioner and 
must be accompanied by a fee of not more than $10 $50 payable to 
the state of Minnesota for deposit in the general fund.  A fee 
of $50 must accompany applications for approval of individuals 
responsible for monitoring course offerings.  If the advisory 
task force is created, it shall make recommendations to the 
commissioner regarding the accreditation of courses sponsored by 
institutions, both public and private, which satisfy the 
criteria established by this section, the number of credit hours 
to be assigned to the courses, and rules which may be 
promulgated by the commissioner.  The advisory task force shall 
seek out and encourage the presentation of courses.  
    (b) If the advisory task force is created, it shall make 
recommendations and provide subsequent evaluations to the 
commissioner regarding procedures for reporting compliance with 
the minimum education requirement.  
    Sec. 35.  Minnesota Statutes 1983 Supplement, section 
60A.1701, subdivision 10, is amended to read: 
    Subd. 10.  [REPORTING.] (a) After completing the minimum 
education requirement, each person subject to this section shall 
file or cause to be filed a compliance report annually in 
accordance with the procedures adopted by the commissioner.  
    (b) Each compliance report must be accompanied by an annual 
continuing education fee of $5 payable to the state of Minnesota 
for deposit in the general fund.  
    (c) An institution offering an accredited course shall 
comply with the procedure for reporting compliance adopted by 
the commissioner.  
    (d) If a person subject to this section completes a 
nonaccredited course, he may submit a written report to the 
advisory committee accompanied by a fee of not more than $10 
payable to the state of Minnesota for deposit in the general 
fund.  This report must be accompanied by proof satisfactory to 
the commissioner that the person has completed the minimum 
education requirement for the annual period during which the 
nonaccredited course was completed.  Upon the recommendation of 
the advisory committee that the course satisfies the criteria 
for course accreditation, the commissioner may approve the 
nonaccredited course and shall so inform the person.  If the 
nonaccredited course is approved by the commissioner, it may be 
used to satisfy the minimum education requirement for the 
person's next annual compliance period.  
    Sec. 36.  Minnesota Statutes 1983 Supplement, section 
60A.1701, subdivision 11, is amended to read: 
    Subd. 11.  [ENFORCEMENT.] If a person subject to this 
section fails to complete the minimum education or reporting 
requirement or to pay the prescribed fees for any annual period, 
no license may be renewed or continued in force for that person 
for any class of insurance beginning June 1 of the year due and 
that person may not act as an insurance agent until the person 
has demonstrated to the satisfaction of the commissioner that 
all requirements of this section have been complied with or that 
a waiver or extension has been obtained.  
    If a person subject to this section fails to file a 
compliance request or a request for a waiver or extension with 
the commissioner within 30 days of the date on which the person 
is required to report, the commissioner may issue an order 
summarily suspending that person's license.  The order is 
effective upon service on the person by first class mail at his 
last known address on file with the commissioner.  A person 
whose license has been summarily suspended under this 
subdivision may, within 15 days of the date of the order, 
request a hearing to be conducted according to the provisions of 
chapter 14.  The hearing must be held within 15 days of the 
commissioner's receipt of the request, but the person may agree 
to an extension.  The summary suspension remains in effect 
pending the outcome of the hearing.  
    Sec. 37.  Minnesota Statutes 1982, section 60A.18, 
subdivision 3, is amended to read:  
    Subd. 3.  [LICENSE, APPLICATION, CONTENTS.] The application 
for a license for each device to be used shall be made by the 
agent in such form and with such information as shall be 
prescribed by the commissioner.  A fee of $3 $20 for each device 
shall be paid at the time of making application.  Upon approval 
of the application, the commissioner shall issue to the agent a 
special vending machine license. The license shall apply to a 
specific device or to any device of identical type which, after 
written notice by the agent to the commissioner, is substituted 
for it.  The license shall specify the name and address of the 
agent, the name and home office address of the insuring company, 
the name or other identifying information of the policy or 
policies to be sold, the serial number or other identification 
of the device and the address, including the location on the 
premises, where the device is to be in operation; provided, 
however, that a device for which a license has been issued for 
operation at a specific address may be transferred to a 
different address during the license year upon written notice to 
the commissioner at the time of such transfer.  The license for 
each device shall expire on September 1st May 31st of each year, 
but may be renewed from year to year by the commissioner upon 
approval of the application by the agent and the furnishing of 
such information as shall be requested by the commissioner, and 
the payment of $3 $20 for each license year or part thereof for 
each device.  Proof of the existence of a subsisting license 
shall be displayed on or about each such device in use in such 
manner as the commissioner may reasonably require.  
    Sec. 38.  Minnesota Statutes 1982, section 60A.19, 
subdivision 4, is amended to read: 
    Subd. 4.  [FEES.] The commissioner shall be entitled to 
charge and receive a fee prescribed by section 60A.14, 
subdivision 1, (3) (d) paragraph (c), clause (4), for each 
notice, proof of loss, summons, or other process served upon him 
under the provisions of subdivisions 3 and 4, to be paid by the 
persons serving the same.  The service of process is made by 
delivering to and leaving with the commissioner two copies 
thereof for each company being served.  
    Sec. 39.  Minnesota Statutes 1982, section 60A.19, 
subdivision 8, is amended to read: 
    Subd. 8.  [INSURANCE FROM UNLICENSED FOREIGN COMPANIES.] 
When any person, firm, or corporation desires to obtain 
insurance upon any property, interests, or risks of any nature 
other than life insurance in this state in companies not 
authorized to do business therein he or they shall give bond to 
the commissioner of commerce in such sum as he shall deem 
reasonable, with satisfactory resident sureties, conditioned 
that the obligors, on the expiration of a license to obtain such 
insurance, shall pay to the commissioner of revenue, for the use 
of the state, a tax of two percent upon the gross premiums paid 
by the licensee.  Thereupon the commissioner of commerce shall 
issue such license, good for one year, and all insurance 
procured thereunder shall be lawful and valid and the provisions 
of all policies thereof shall be deemed in accordance, and 
construed as if identical in effect, with the standard policy 
prescribed by the laws of this state and the insurers may enter 
the state to perform any act necessary or proper in the conduct 
of the business. This bond may be enforced by the commissioner 
of commerce in his own name in any district court.  The licensee 
shall file with the commissioner of commerce on June thirtieth 
and December thirty-first annually a verified statement of the 
aggregate premiums paid and returned premiums received on 
account of such insurance. 
    Sec. 40.  Minnesota Statutes 1983 Supplement, section 
60A.198, subdivision 3, is amended to read:  
    Subd. 3.  [PROCEDURE FOR OBTAINING LICENSE.] A person 
licensed as a resident agent in this state pursuant to other law 
may obtain a surplus lines license by doing the following:  
    (a) filing an application in the form and with the 
information the commissioner may reasonably require to determine 
the ability of the applicant to act in accordance with sections 
60A.195 to 60A.209;  
    (b) maintaining a resident agent license in this state;  
    (c) delivering to the commissioner a financial guarantee 
bond from a surety acceptable to the commissioner for the 
greater of the following:  
    (1) $5,000; or 
    (2) the largest semiannual surplus lines premium tax 
liability incurred by him in the immediately preceding five 
years; and 
    (d) agreeing to file with the commissioner of revenue no 
later than February 15 and August 15 annually, a sworn statement 
of the charges for insurance procured or placed and the amounts 
returned on the insurance canceled under the license for the 
preceding six month period ending December 31 and June 30 
respectively, and at the time of the filing of this statement, 
paying the commissioner a tax on premiums equal to three percent 
of the total written premiums less cancellations; and 
    (e) annually paying a fee as prescribed by section 60A.14, 
subdivision 1, paragraph (c), clause (11). 
    Sec. 41.  Minnesota Statutes 1982, section 60A.199, is 
amended to read: 
    60A.199 [EXAMINATIONS.] 
    Subdivision 1.  [EXAMINATION OF BOOKS AND RECORDS.] If the 
commissioner considers it necessary, he may examine the books 
and records of a surplus lines licensee to determine whether the 
licensee is conducting business in accordance with sections 
60A.195 to 60A.209.  For the purposes of facilitating 
examinations, the licensee shall allow the commissioner free 
access at reasonable times to all of the licensee's books and 
records relating to the transactions to which sections 60A.195 
to 60A.209 apply.  If an examination is conducted, the cost of 
the examination shall be paid by the insurer. 
    Subd. 2.  [EXAMINATION OF RETURNS; ASSESSMENT; REFUNDS.] 
The commissioner of revenue shall, as soon as practicable after 
a return required by section 60A.198 is filed, examine it and 
make any investigation or examination of the company's records 
and accounts that he deems necessary for determining the 
correctness of the return.  The tax computed by him on the basis 
of the examination and investigation is the tax to be paid by 
the company.  If the tax found due is greater than the amount 
reported due on the company's return, the commissioner shall 
assess a tax in the amount of the excess and the whole amount of 
the excess shall be paid to the commissioner within 60 days 
after notice of the amount and demand for its payment is mailed 
to the company by the commissioner.  If the understatement of 
the tax on the return was false and fraudulent with intent to 
evade the tax, the installments of the tax shown by the company 
on its return which are not paid shall be paid to the state 
treasurer within 60 days after notice of the amount thereof and 
demand for payment is mailed to the company by the 
commissioner.  If the amount of the tax found due by the 
commissioner is less than that reported due on the company's 
return, the excess shall be refunded to the company in the 
manner provided by this section, except that no demand therefor 
is necessary, if the whole of the tax has been paid or credited 
against any unpaid installment thereof.  No refund shall be made 
except as provided in this section after the expiration of three 
and one-half years after the filing of the return.  
    If the commissioner examines returns of a company for more 
than one year, he may issue one order covering the several years 
under consideration reflecting the aggregate refund or 
additional tax due.  
    The notices and demands provided for by this section shall 
be in the form the commissioner determines, including a 
statement, and shall contain a brief explanation of the 
computation of the tax and shall be sent by mail to the company 
at the address given in its return.  If the address is not 
given, then they will be sent to the last known address.  
    Subd. 3.  [FAILURE TO FILE; FALSE OR FRAUDULENT RETURN.] If 
any company required by section 60A.198 to file any return fails 
to do so within the time prescribed or makes, wilfully or 
otherwise, an incorrect, false, or fraudulent return, it must, 
on the written demand of the commissioner of revenue, file the 
return, or corrected return, within 60 days after the mailing of 
the written demand and at the same time pay the whole tax, or 
additional tax, due on the basis thereof.  If the company fails 
within that time to file the return, or corrected return, the 
commissioner shall make for it a return, or corrected return, 
from his own knowledge and from the information he can obtain 
through testimony, or otherwise, and assess a tax on the basis 
thereof.  The tax assessed, less any payments theretofore made 
on account of the tax for the taxable year covered by the 
return, must be paid within 60 days after the commissioner has 
mailed to the company a written notice of the amount thereof and 
demand for its payment.  Any return or assessment made by the 
commissioner on account of the failure of the company to make a 
return, or a corrected return, is prima facie correct and valid, 
and the company has the burden of establishing its incorrectness 
or invalidity in any action or proceeding in respect thereto.  
    Subd. 4.  [FAILURE TO FILE; PENALTIES AND INTEREST.] In 
case of any failure to make and file a return as required by 
this chapter within the time prescribed by law or prescribed by 
the commissioner in pursuance of law there shall be added to the 
tax penalties and interest as provided in section 290.53, 
subdivision 2.  
    Subd. 5.  [INTENT TO EVADE TAX; PENALTY.] If any company 
with intent to evade the tax imposed by this chapter, fails to 
file any return required by this chapter or with such intent 
files a false or fraudulent return there shall also be imposed 
on it a penalty as provided in section 290.53, subdivision 3.  
    Subd. 6.  [NEGLIGENCE OR INTENTIONAL DISREGARD; PENALTY.] 
If any part of any additional assessment is due to negligence or 
intentional disregard of the statute or a rule (but without 
intent to defraud), there shall be added to the tax a penalty as 
provided in section 290.53, subdivision 3a.  
    Subd. 7.  [COLLECTION OF TAX.] The tax required to be paid 
by section 60A.198 may be collected in any ordinary action at 
law by the commissioner of revenue against the company.  In any 
action commenced pursuant to this section, upon the filing of an 
affidavit of default, the clerk of the district court wherein 
the action was commenced shall enter judgment for the state for 
the amount demanded in the complaint together with costs and 
disbursements.  
    Subd. 8.  [REFUND PROCEDURE; TIME LIMIT; APPROPRIATION.] A 
company which has paid, voluntarily or otherwise, or from which 
there was collected an amount of tax for any year in excess of 
the amount legally due for that year, may file with the 
commissioner of revenue a claim for a refund of the excess. 
Except as provided in subdivision 3, no claim or refund shall be 
allowed or made after 3-1/2 years from the date prescribed for 
filing the return (plus any extension of time granted for filing 
the return but only if filed within the extended time) or after 
two years from the date of overpayment, whichever period is 
longer, unless before the expiration of the period a claim is 
filed by the company.  For this purpose, a return or amended 
return claiming an overpayment constitutes a claim for refund.  
    Upon the filing of a claim the commissioner shall examine 
the same and shall make and file written findings thereon 
denying or allowing the claim in whole or in part.  He shall 
mail a notice thereof to the company at the address stated upon 
the return.  If the claim is allowed in whole or in part, the 
commissioner shall issue his certificate for a refund of the 
excess paid by the company, with interest at the rate of six 
percent per annum computed from the date of the payment of the 
tax until the date the refund is paid or credit is made to the 
company.  The commissioner of finance shall cause the refund to 
be paid as other state moneys are expended.  So much of the 
proceeds of the taxes as is necessary are appropriated for that 
purpose.  
    Subd. 9.  [DENIAL OF CLAIM; COURT PROCEEDINGS.] If the 
claim is denied in whole or in part, the commissioner shall mail 
an order of denial to the company in the manner prescribed in 
section 60A.199.  An appeal from this order may be taken to the 
Minnesota tax court in the manner prescribed in section 271.06, 
or the company may commence an action against the commissioner 
to recover the denied overpayment.  The action may be brought in 
the district court of the district in which lies the county of 
its principal place of business, or in the district court for 
Ramsey county.  The action in the district court shall be 
commenced within 18 months following the mailing of the order of 
denial to the company.  If a claim for refund is filed by a 
company and no order of denial is issued within six months of 
the filing, the company may commence an action in the district 
court as in the case of a denial, but the action must be 
commenced within two years of the date that the claim for refund 
was filed.  
    Subd. 10.  [CONSENT TO EXTEND TIME.] If the commissioner 
and the company have, within the periods prescribed in 
subdivision 1, consented in writing to any extension of time for 
the assessment of the tax, the period within which a claim for 
refund may be filed, or a refund may be made or allowed, if no 
claim is filed, is the period within which the commissioner and 
the company have consented to an extension for the assessment of 
the tax and six months thereafter, the period within which a 
claim for refund may be filed shall not expire prior to two 
years after the tax was paid.  
    Subd. 11.  [OVERPAYMENT; REFUNDS.] If the amount determined 
to be an overpayment exceeds the taxes imposed by section 
60A.198, the amount of excess shall be considered an 
overpayment.  An amount paid as tax shall constitute an 
overpayment even if in fact there was no tax liability with 
respect to which the amount was paid.  
    Notwithstanding any other provision of law to the contrary, 
in the case of any overpayment the commissioner, within the 
applicable period of limitations, shall refund any balance of 
more than $1 to the company if the company so requests.  
    Sec. 42.  Minnesota Statutes 1982, section 60A.21, 
subdivision 2, is amended to read: 
    Subd. 2.  [SERVICE OF PROCESS UPON UNAUTHORIZED INSURER.] 
(1) Any of the following acts in this state effected by mail or 
otherwise by an unauthorized foreign or alien insurer:  (a) the 
issuance or delivery of contracts of insurance to residents of 
this state or to corporations authorized to do business therein; 
(b) the solicitation of applications for such contracts; (c) the 
collection of premiums, membership fees, assessments, or other 
considerations for such contracts; or (d) any other transaction 
of insurance business, is equivalent to and shall constitute an 
appointment by such insurer of the commissioner of insurance and 
his successor or successors in office to be its true and lawful 
attorney upon whom may be served all lawful process in any 
action, suit, or proceeding instituted by or on behalf of an 
insured or beneficiary arising out of any such contract of 
insurance and any such act shall be signification of its 
agreement that such service of process is of the same legal 
force and validity as personal service of process in this state 
upon such insurer. 
    (2) Such service of process shall be made by delivering to 
and leaving with the commissioner of insurance or some person in 
apparent charge of his office two copies thereof and the payment 
to him of a filing fee of $3 as prescribed by section 60A.14, 
subdivision 1, paragraph (c), clause (4).  The commissioner of 
insurance shall forthwith mail by certified mail one of the 
copies of such process to the defendant at its last known 
principal place of business and shall keep a record of all 
process so served upon him.  Such service of process is 
sufficient provided notice of such service and a copy of the 
process are sent within ten days thereafter by certified mail by 
plaintiff or plaintiff's attorney to the defendant at its last 
known principal place of business and the defendant's receipt, 
or receipt issued by the post office with which the letter is 
certified showing the name of the sender of the letter and the 
name and address of the person to whom the letter is addressed, 
and the affidavit of the plaintiff or plaintiff's attorney 
showing a compliance herewith are filed with the clerk of the 
court in which such action is pending on or before the date the 
defendant is required to appear or within such further time as 
the court may allow. 
    (3) Service of process in any such action, suit, or 
proceeding shall in addition to the manner provided in clause 
(2) of this subdivision be valid if served upon any person 
within this state who, in this state on behalf of such insurer, 
is:  (a) soliciting insurance, or (b) making, issuing, or 
delivering any contract of insurance, or (c) collecting or 
receiving any premium, membership fee, assessment, or other 
consideration for insurance; and if a copy of such process is 
sent within ten days thereafter by certified mail by the 
plaintiff or plaintiff's attorney to the defendant at the last 
known principal place of business of the defendant and the 
defendant's receipt, or the receipt issued by the post office 
with which the letter is certified showing the name of the 
sender of the letter and the name and address of the person to 
whom the letter is addressed, and the affidavit of the plaintiff 
or plaintiff's attorney showing a compliance herewith are filed 
with the clerk of the court in which such action is pending on 
or before the date the defendant is required to appear or within 
such further time as the court may allow. 
    (4) No plaintiff or complainant shall be entitled to a 
judgment by default under this subdivision until the expiration 
of 30 days from the date of the filing of the affidavit of 
compliance. 
    (5) Nothing in this subdivision contained shall limit or 
abridge the right to serve any process, notice, or demand upon 
any insurer in any other manner now or hereafter permitted by 
law. 
    (6) The provisions of this section shall not apply to 
surplus line insurance lawfully effectuated under Minnesota law, 
or to reinsurance, nor to any action or proceeding against an 
unauthorized insurer arising out of: 
    (a) Wet marine and transportation insurance; 
    (b) Insurance on or with respect to subjects located, 
resident, or to be performed wholly outside this state, or on or 
with respect to vehicles or aircraft owned and principally 
garaged outside this state; 
    (c) Insurance on property or operations of railroads 
engaged in interstate commerce; or 
    (d) Insurance on aircraft or cargo of such aircraft, or 
against liability, other than employer's liability, arising out 
of the ownership, maintenance, or use of such aircraft, where 
the policy or contract contains a provision designating the 
commissioner as its attorney for the acceptance of service of 
lawful process in any action or proceeding instituted by or on 
behalf of an insured or beneficiary arising out of any such 
policy, or where the insurer enters a general appearance in any 
such action. 
    Sec. 43.  Minnesota Statutes 1982, section 60A.23, 
subdivision 5, is amended to read: 
    Subd. 5.  [PROVISIONS AS TO FIDELITY AND SURETY COMPANIES.] 
(1) [REQUIREMENTS AND ACCEPTABILITY.] No company for 
guaranteeing the fidelity of persons in fiduciary positions, 
public or private, or for acting as surety, shall transact any 
business in this state until it shall have satisfied the 
commissioner that it has complied with all the provisions of law 
and obtained his certificate to that effect.  Thereupon it shall 
be authorized to execute as sole or joint surety any bond, 
undertaking, or recognizance which, by any municipal or other 
law, or by the rules or regulations of any municipal or other 
board, body, organization, or officer, is required or permitted 
to be made, given, tendered, or filed for the security or 
protection of any person, corporation, or municipality, or any 
department thereof, or of any other organization, conditioned 
for the doing or omitting of anything in such bond or other 
instrument specified or provided; and any and all courts, 
judges, officers, and heads of departments, boards, and 
municipalities required or permitted to accept or approve of the 
sufficiency of any such bond or instrument may in their 
discretion accept the same when executed, or the conditions 
thereof guaranteed solely or jointly by any such company, and 
the same shall be in all respects full compliance with every law 
or other provisions for the execution or guaranty by one surety 
or by two or more sureties, or that sureties shall be residents 
or householders, or freeholders, or all or either. 
    (2) [COUNTERSIGNATURE NOT REQUIRED.] The countersignature 
of a licensed resident agent shall not be required of any bid 
bond issued in connection with any public or private contract 
when such bid bond is issued by an insurer duly authorized to do 
business in this state.  
    (3) [LIMITS OF RISK.] No fidelity or surety company shall 
insure or reinsure in a single risk, less any portion thereof 
reinsured, a larger sum than one-tenth of its net assets. 
    Sec. 44.  Minnesota Statutes 1982, section 61A.02, is 
amended to read:  
    61A.02 [FORMS OF POLICY.] 
    Subdivision 1.  [PROHIBITED.] So-called coupon policies 
shall not be issued or delivered by any company to any residents 
of this state.  
    Subd. 2.  [APPROVAL REQUIRED.] No policy of life insurance 
nor any rider of any kind or description which is made a part 
thereof shall be issued or delivered in this state, or be issued 
by a life insurance company organized under the laws of this 
state, until the form of the same has been filed with approved 
by the commissioner; and after he shall have notified any 
company of his disapproval of any form,.  In making a 
determination under this section, the commissioner may require 
the insurer to provide rates and advertising materials related 
to policies issued or delivered in this state.  
    Subd. 3.  [DISAPPROVAL.] The commissioner shall, within 60 
days after the filing of any form, disapprove the form:  
    (1) if the benefits provided are unreasonable in relation 
to the premium charged;  
    (2) if it contains a provision or provisions which are 
unlawful, unfair, inequitable, misleading, or encourages 
misrepresentation of the policy; or 
    (3) if the form, or its provisions, is otherwise not in the 
public interest.  It shall be unlawful for the company to issue 
any policy in the form so disapproved.  The commissioner's 
action shall be subject to review by any court of competent 
jurisdiction If the commissioner does not within 60 days after 
the filing of any form, disapprove or otherwise object, the form 
shall be deemed approved.  
    Subd. 4.  [WITHDRAWAL OF APPROVAL.] The commissioner may at 
any time withdraw approval of any policy or form upon the 
grounds stated in subdivision 3.  It is unlawful for the insurer 
to issue the form or use it in connection with any policy after 
the effective date of the withdrawal of approval.  
    Subd. 5.  [HEARING.] Notification of disapproval or 
withdrawal of approval must be made to the insurer in writing, 
specifying the grounds for the disapproval.  Upon written 
request made by the insurer, the commissioner shall grant a 
hearing within 30 days after receipt of the request.  All 
hearings must be conducted in accordance with chapter 14. 
Following the hearing, the commissioner may affirm, reverse, or 
modify the previous determination made with respect to the 
subject policy or form.  
    Sec. 45.  Minnesota Statutes 1982, section 61A.03, is 
amended by adding a subdivision to read: 
    Subd. 2a.  No life insurer subject to this section is 
required to file more than one policy with a policy loan 
provision providing for a fixed rate of interest.  
    Sec. 46.  [61A.255] [SPECIAL PROVISION.] 
    For the purposes of sections 61A.24 and 61A.25, insurers 
may utilize the 1958 Commissioners Standard Ordinary and the 
1958 Commissioners Extended Term smoker and nonsmoker mortality 
tables and the 1980 Commissioners Standard Ordinary and the 1980 
Commissioners Extended Term smoker and nonsmoker mortality 
tables in addition to the tables specified in sections 61A.24 
and 61A.25.  The tables may be utilized as provided in the model 
rule permitting smoker and nonsmoker mortality tables for use in 
determining minimum reserve liabilities and nonforfeiture 
benefits adopted by the National Association of Insurance 
Commissioners.  This section applies to policies issued on or 
after January 1, 1984, and before January 1, 1989.  
    Sec. 47.  Minnesota Statutes 1982, section 62A.025, is 
amended to read: 
    62A.025 [UNIFORM HEALTH INSURANCE CLAIM FORMS.] 
    The commissioner of insurance commerce shall prescribe 
uniform health insurance claim forms for each class of provider 
which shall be used by all insurers issuing in this state 
policies of accident and sickness insurance, and all service 
plan corporations issuing in this state subscriber contracts, 
and all state agencies that require health insurance claims for 
their records.  The forms shall be scannable where required and 
provide information as required to insure maximum federal 
participation in program and administrative costs.  Whenever 
feasible, the commissioner shall utilize the standardized claim 
form of the provider or an association to which the provider 
belongs.  
    Sec. 48.  Minnesota Statutes 1982, section 62E.14, 
subdivision 1, is amended to read:  
    Subdivision 1.  [CERTIFICATE, CONTENTS.] The comprehensive 
health insurance plan shall be open for enrollment by eligible 
persons.  An eligible person shall enroll by submission of a 
certificate of eligibility to the writing carrier.  The 
certificate shall provide the following: 
    (a) Name, address, age, and length of time at residence of 
the applicant; 
    (b) Name, address, and age of spouse and children if any, 
if they are to be insured; 
    (c) Evidence of rejection, a requirement of restrictive 
riders, a rate up, or a pre-existing conditions limitation on a 
qualified plan, the effect of which is to substantially reduce 
coverage from that received by a person considered a standard 
risk, by at least two one association members within six months 
of the date of the certificate, or other eligibility 
requirements adopted by rule by the commissioner which are not 
inconsistent with this chapter and which evidence that a person 
is unable to obtain coverage substantially similar to that which 
may be obtained by a person who is considered a standard risk; 
and 
    (d) A designation of the coverage desired. 
    An eligible person may not purchase more than one policy 
from the state plan.  Upon ceasing to be a resident of Minnesota 
a person is no longer eligible to purchase or renew coverage 
under the state plan.  
    Sec. 49.  Minnesota Statutes 1982, section 62E.15, 
subdivision 3, is amended to read:  
    Subd. 3.  The writing carrier shall pay an agent's referral 
fee of $25 $50 to each insurance agent who refers an applicant 
to the state plan, if the application is accepted.  Selling or 
marketing of qualified state plans shall not be limited to the 
writing carrier or its agents. The referral fees shall be paid 
by the writing carrier from money received as premiums for the 
state plan.  
    Sec. 50.  Minnesota Statutes 1983 Supplement, section 
65A.01, subdivision 3, is amended to read: 
    Subd. 3.  [POLICY PROVISIONS.] On said policy following 
such matter as provided in subdivisions 1 and 2, printed in the 
English language in type of such size or sizes and arranged in 
such manner, as is approved by the commissioner of insurance, 
the following provisions and subject matter shall be stated in 
the following words and in the following sequence, but with the 
convenient placing, if desired, of such matter as will act as a 
cover or back for such policy when folded, with the blanks below 
indicated being left to be filled in at the time of the issuing 
of the policy, to wit: 
     (Space for listing the amounts of insurance, rates and 
premiums for the basic coverages provided under the standard 
form of policy and for additional coverages or perils provided 
under endorsements attached.  The description and location of 
the property covered and the insurable value(s) of any 
building(s) or structure(s) covered by the policy or its 
attached endorsements; also in the above space may be stated 
whether other insurance is limited and if limited the total 
amount permitted.) 
     In consideration of the provisions and stipulations herein 
or added hereto and of the premium above specified this company, 
for a term of ..... from ..... (At 12:01 a.m. Standard Time) to 
..... (At 12:01 a.m. Standard Time) at location of property 
involved, to an amount not exceeding the amount(s) above 
specified does insure .....  and legal representatives 
........................................... 
    (In above space may be stated whether other insurance is 
limited.) (And if limited the total amount permitted.) 
    Subject to form No.(s) ..... attached hereto. 
    This policy is made and accepted subject to the foregoing 
provisions and stipulations and those hereinafter stated, which 
are hereby made a part of this policy, together with such 
provisions, stipulations and agreements as may be added hereto 
as provided in this policy. 
    This policy shall not be valid unless countersigned by the 
duly authorized agent of this company.  
    Countersigned at ..... this ..... day of ..... 19....., 
....., Agent.  
    The insurance effected above is granted against all loss or 
damage by fire originating from any cause, except as hereinafter 
provided, also any damage by lightning and by removal from 
premises endangered by the perils insured against in this 
policy, to the property described hereinafter while located or 
contained as described in this policy, or pro rata for five days 
at each proper place to which any of the property shall 
necessarily be removed for preservation from the perils insured 
against in this policy, but not elsewhere.  The amount of said 
loss or damage, except in case of total loss on buildings, to be 
estimated according to the actual value of the insured property 
at the time when such loss or damage happens. 
     If the insured property shall be exposed to loss or damage 
from the perils insured against, the insured shall make all 
reasonable exertions to save and protect same. 
     This entire policy shall be void if, whether before a loss, 
the insured has willfully, or after a loss, the insured has 
willfully and with intent to defraud, concealed or 
misrepresented any material fact or circumstance concerning this 
insurance or the subject thereof, or the interests of the 
insured therein. 
     This policy shall not cover accounts, bills, currency, 
deeds, evidences of debt, money or securities; nor, unless 
specifically named hereon in writing, bullion, or manuscripts. 
     This company shall not be liable for loss by fire or other 
perils insured against in this policy caused, directly or 
indirectly by:  (a) enemy attack by armed forces, including 
action taken by military, naval or air forces in resisting an 
actual or immediately impending enemy attack; (b) invasion; (c) 
insurrection; (d) rebellion; (e) revolution; (f) civil war; (g) 
usurped power; (h) order of any civil authority except acts of 
destruction at the time of and for the purpose of preventing the 
spread of fire, providing that such fire did not originate from 
any of the perils excluded by this policy. 
     Other insurance may be prohibited or the amount of 
insurance may be limited by so providing in the policy or an 
endorsement, rider or form attached thereto. 
     Unless otherwise provided in writing added hereto this 
company shall not be liable for loss occurring: 
     (a) while the hazard is increased by any means within the 
control or knowledge of the insured; or 
     (b) while the described premises, whether intended for 
occupancy by owner or tenant, are vacant or unoccupied beyond a 
period of 60 consecutive days; or 
     (c) as a result of explosion or riot, unless fire ensue, 
and in that event for loss by fire only. 
     Any other peril to be insured against or subject of 
insurance to be covered in this policy shall be by endorsement 
in writing hereon or added hereto. 
     The extent of the application of insurance under this 
policy and the contributions to be made by this company in case 
of loss, and any other provision or agreement not inconsistent 
with the provisions of this policy, may be provided for in 
writing added hereto, but no provision may be waived except such 
as by the terms of this policy is subject to change. 
     No permission affecting this insurance shall exist, or 
waiver of any provision be valid, unless granted herein or 
expressed in writing added hereto.  No provision, stipulation or 
forfeiture shall be held to be waived by any requirements or 
proceeding on the part of this company relating to appraisal or 
to any examination provided for herein. 
     This policy shall be canceled at any time at the request of 
the insured, in which case this company shall, upon demand and 
surrender of this policy, refund the excess of paid premium 
above the customary short rates for the expired time.  This 
policy may be canceled at any time by this company by giving to 
the insured a ten days' written notice of cancellation with or 
without tender of the excess of paid premium above the pro rata 
premium for the expired time, which excess, if not tendered, 
shall be refunded on demand.  Notice of cancellation shall state 
that said excess premium (if not tendered) will be refunded on 
demand. 
     If loss hereunder is made payable, in whole or in part, to 
a designated mortgagee not named herein as insured, such 
interest in this policy may be canceled by giving to such 
mortgagee a ten days' written notice of cancellation. 
     Notwithstanding any other provisions of this policy, if 
this policy shall be made payable to a mortgagee of the covered 
real estate, no act or default of any person other than such 
mortgagee or his agent or those claiming under him, whether the 
same occurs before or during the term of this policy, shall 
render this policy void as to such mortgagee nor affect such 
mortgagee's right to recover in case of loss on such real 
estate; provided, that the mortgagee shall on demand pay 
according to the established scale of rates for any increase of 
risks not paid for by the insured; and whenever this company 
shall be liable to a mortgagee for any sum for loss under this 
policy for which no liability exists as to the mortgagor, or 
owner, and this company shall elect by itself, or with others, 
to pay the mortgagee the full amount secured by such mortgage, 
then the mortgagee shall assign and transfer to the company his 
interest, upon such payment, in the said mortgage together with 
the note and debts thereby secured. 
     This company shall not be liable for a greater proportion 
of any loss than the amount hereby insured shall bear to the 
whole insurance covering the property against the peril involved.
     In case of any loss under this policy the insured shall 
give immediate written notice to this company of any loss, 
protect the property from further damage, and a statement in 
writing, signed and sworn to by the insured, shall within 60 
days be rendered to the company, setting forth the value of the 
property insured, except in case of total loss on buildings the 
value of said buildings need not be stated, the interest of the 
insured therein, all other insurance thereon, in detail, the 
purposes for which and the persons by whom the building insured, 
or containing the property insured, was used, and the time at 
which and manner in which the fire originated, so far as known 
to the insured. 
     The insured, as often as may be reasonably required, shall 
exhibit to any person designated by this company all that 
remains of any property herein described, and, after being 
informed that he has a right to counsel and that his answers may 
be used against him in later civil or criminal proceedings, the 
insured shall, within a reasonable period after demand by this 
company, submit to examinations under oath by any person named 
by this company, and subscribe the oath.  The insured, as often 
as may be reasonably required, shall produce for examination all 
records and documents reasonably related to the loss, or 
certified copies thereof if originals are lost, at a reasonable 
time and place designated by this company or its 
representatives, and shall permit extracts and copies thereof to 
be made.  
     In case the insured and this company, except in case of 
total loss on buildings, shall fail to agree as to the actual 
cash value or the amount of loss, then, on the written demand of 
either, each shall select a competent and disinterested 
appraiser and notify the other of the appraiser selected within 
20 days of such demand.  In case either fails to select an 
appraiser within the time provided, then a presiding judge of 
the district court of the county wherein the loss occurs may 
appoint such appraiser for such party upon application of the 
other party in writing by giving five days' notice thereof in 
writing to the party failing to appoint.  The appraisers shall 
first select a competent and disinterested umpire; and failing 
for 15 days to agree upon such umpire, then a presiding judge of 
the above mentioned court may appoint such an umpire upon 
application of party in writing by giving five days' notice 
thereof in writing to the other party.  The appraisers shall 
then appraise the loss, stating separately actual value and loss 
to each item; and, failing to agree, shall submit their 
differences, only, to the umpire.  An award in writing, so 
itemized, of any two when filed with this company shall 
determine the amount of actual value and loss.  Each appraiser 
shall be paid by the party selecting him, or for whom he was 
selected, and the expense of the appraisal and umpire shall be 
paid by the parties equally. 
     It shall be optional with this company to take all of the 
property at the agreed or appraised value, and also to repair, 
rebuild or replace the property destroyed or damaged with other 
of like kind and quality within a reasonable time, on giving 
notice of its intention so to do within 30 days after the 
receipt of the proof of loss herein required. 
     There can be no abandonment to this company of any property.
     The amount of loss for which this company may be liable 
shall be payable 60 days after proof of loss, as herein 
provided, is received by this company and ascertainment of the 
loss is made either by agreement between the insured and this 
company expressed in writing or by the filing with this company 
of an award as herein provided.  It is moreover understood that 
there can be no abandonment of the property insured to the 
company, and that the company will not in any case be liable for 
more than the sum insured, with interest thereon from the time 
when the loss shall become payable, as above provided. 
     No suit or action on this policy for the recovery of any 
claim shall be sustainable in any court of law or equity unless 
all the requirements of this policy have been complied with, and 
unless commenced within two years after inception of the loss. 
     This company is subrogated to, and may require from the 
insured an assignment of all right of recovery against any party 
for loss to the extent that payment therefor is made by this 
company; and the insurer may prosecute therefor in the name of 
the insured retaining such amount as the insurer has paid. 
     Assignment of this policy shall not be valid except with 
the written consent of this company. 
     IN WITNESS WHEREOF, this company has executed and attested 
these presents. 
 
 ........................         ........................
      (Signature)                     (Signature)         
 ........................         ........................
     (Name of office)                (Name of office)     
    Sec. 51.  Minnesota Statutes 1982, section 65A.03, is 
amended to read: 
    65A.03 [BINDERS, TEMPORARY INSURANCE.] 
    Subdivision 1.  [GENERALLY.] Binders or other contracts for 
temporary insurance may be made orally or in writing, and shall 
be deemed to include all the terms of such standard fire 
insurance policy and all such applicable endorsements as may be 
designated in such contract of temporary insurance; except that 
the cancellation clause of such standard fire insurance policy 
and the clause specifying the hour of the day at which the 
insurance shall commence, may be superseded by the express terms 
of such contract of temporary insurance.  
     Subd. 2.  [EVIDENCE FOR PROPERTY PURCHASE FINANCING.] A 
duly authorized binder shall be acceptable as evidence of 
insurance coverage required as a condition of financing the 
purchase of real or personal property, provided that a mortgagee 
or lender shall not be required to accept renewal or extention 
thereof.  This section does not require the approval of a binder 
by any person, firm, corporation, trustee, director, officer, 
agent, or employee, where there are reasonable grounds for 
believing that the insurance evidenced by the binder is 
unsatisfactory as to placement with an unauthorized insurer, the 
financial solvency of the insurer, adequacy of the coverage, 
adequacy of the insurer to assume the risk to be insured, the 
assessment feature to which the policy is subject, or other 
grounds which are not arbitrary, unreasonable, or 
discriminatory, nor does this section forbid the securing of 
insurance or a renewal thereof at the request of the borrower or 
because of the borrower's failure to furnish necessary insurance 
or renewal thereof. 
     Subd. 3.  [PENALTY.] If any person, firm, corporation, 
trustee, director, officer, agent, or employee, refuses to 
accept a duly authorized binder pursuant to subdivisions 1 and 
2, the commissioner of commerce may issue an order requiring 
acceptance and impose a civil penalty of $500 per violation.  
    Sec. 52.  Minnesota Statutes 1982, section 65B.001, 
subdivision 4, is amended to read: 
    Subd. 4.  "Utility vehicle" means any four wheel vehicle, 
other than a private passenger vehicle, which has a pick-up, 
sedan, delivery, van, or panel truck type body and is not used 
primarily in the occupation, profession or business of the 
insured, other than farming or ranching. 
    Sec. 53.  Minnesota Statutes 1982, section 65B.06, 
subdivision 2, is amended to read: 
    Subd. 2.  With respect to private passenger, non-fleet 
automobiles, the facility shall provide for the issuance of 
policies of automobile insurance by participating members with 
coverage as follows: 
    (1) Bodily injury liability and property damage liability 
coverage in the minimum amounts specified in section 65B.49, 
subdivision 3; 
    (2) Uninsured motorists coverage as required by section 
65B.49, subdivision 4; 
    (3) A reasonable selection of additional higher limits of 
liability coverage up to fifty thousand dollars $50,000 because 
of bodily injury to or death of one person in any one accident 
and, subject to such limit for one person, up to one hundred 
thousand dollars $100,000 because of bodily injury to or death 
of two or more persons in any one accident, and up to ten 
thousand dollars $25,000 because of injury to or destruction of 
property of others in any one accident, or higher limits of 
liability coverage as recommended by the governing committee and 
approved by the commissioner; 
    (4) Additional medical expense Basic economic loss benefits 
, as required by section 65B.44, and other optional coverages as 
recommended by the governing committee and approved by the 
commissioner; and 
    (5) Automobile physical damage coverage, including coverage 
of loss by collision, subject to optional deductibles. 
    No coverage available under clause (5) shall be provided by 
a carrier that has been licensed to provide the coverage made 
available under clause (1) or (2), unless the qualified 
applicant has requested coverage pursuant to clause (1) or (2) 
as well as physical damage coverage.  If a qualified applicant 
requests only physical damage coverage, the coverage shall be 
provided by an insurer not writing the coverage specified in 
clauses (1) and (2). 
    Sec. 54.  Minnesota Statutes 1982, section 65B.14, 
subdivision 2, is amended to read: 
    Subd. 2.  "Policy of automobile insurance" or "policy" 
means a policy of private passenger vehicle insurance as defined 
in section 65B.001, or a plan of reparation security as defined 
in section 65B.48 insuring less than five vehicles rated on a 
commercial or fleet basis, or a policy of insurance covering the 
use of a motorcycle, delivered or issued for delivery in this 
state. 
    Sec. 55.  Minnesota Statutes 1982, section 65B.55, 
subdivision 1, is amended to read: 
    Subdivision 1.  A plan of reparation security may prescribe 
a period of not less than six months after the date of accident 
within which an insured or any other person entitled to claim 
basic economic loss benefits, or anyone acting on their behalf, 
must notify the reparation obligor or its agent, of the accident 
and the possibility of a claim for economic loss benefits in 
order to be eligible for such benefits.  Such.  Failure to 
provide notice will not render a person ineligible to receive 
benefits unless actual prejudice is shown by the reparation 
obligor, and then only to the extent of the prejudice.  The 
notice may be given in any reasonable fashion. 
    Sec. 56.  Minnesota Statutes 1982, section 65B.14, 
subdivision 3, is amended to read: 
    Subd. 3.  "Renewal" or "to renew" means the issuance and 
delivery by an insurer of a policy superseding at the end of the 
policy period a policy previously issued and delivered by the 
same insurer on the same rating plan, or the issuance and 
delivery of a certificate or notice extending the term of a 
policy beyond its policy period or term; provided, however, that 
any policy with a policy period or term of less than six months 
or any policy with no fixed expiration date shall for the 
purpose of sections 65B.14 to 65B.21 be considered as if written 
for successive policy periods or terms of six months. 
    Sec. 57.  Minnesota Statutes 1982, section 65B.16, is 
amended to read: 
    65B.16 [STATEMENT OF REASONS FOR CANCELLATION OR 
REDUCTION.] 
    No notice of cancellation or reduction in the limits of 
liability of coverage of an automobile insurance policy under 
section 65B.15 shall be effective unless the specific 
underwriting or other reason or reasons for such cancellation or 
reduction in the limits of liability of coverage are stated in 
such notice and the notice is mailed or delivered by the insurer 
to the named insured at least 30 days prior to the effective 
date of cancellation; provided, however, that when nonpayment of 
premium is the reason for cancellation or when the company is 
exercising its right to cancel insurance which has been in 
effect for less than 60 days at least ten days notice of 
cancellation shall be given.  When nonpayment of premiums is the 
reason for cancellation, the reason must be given to the insured 
with the notice of cancellation; and if the company is 
exercising its right to cancel within the first 60 59 days of 
coverage and notice is given with less than ten days remaining 
in the 60 59-day period, the coverage must be extended, to 
expire ten days after notice was mailed.  
    Sec. 58.  Minnesota Statutes 1983 Supplement, section 
65B.17, subdivision 1, is amended to read: 
    Subdivision 1.  [GENERAL REGULATIONS.] No insurer shall 
fail to renew an automobile insurance policy unless it shall 
mail or deliver to the named insured, at the address shown in 
the policy, at least 60 days advance notice of its intention not 
to renew.  The notice must contain the specific underwriting or 
other reason or reasons for the nonrenewal.  When the failure to 
renew is based upon a termination of the agency contract, the 
notice must so state.  This section does not apply: 
     (a) If the insurer has manifested its willingness to renew; 
or 
     (b) In case of nonpayment of the renewal premium; 
     Provided that, notwithstanding the failure of an insurer to 
comply with this section, the policy terminates on the effective 
date of any other automobile insurance policy procured by the 
insured, with respect to any automobile designated in both 
policies.  Renewal of a policy does not constitute a waiver or 
estoppel with respect to grounds for cancellation which existed 
before the effective date of the renewal.  No insurer shall fail 
to renew an automobile policy solely because of the age of the 
insured.  No insurer shall refuse to renew an automobile 
insurance policy for reasons which are arbitrary or capricious.  
No insurer shall refuse to renew an automobile insurance policy 
in violation of rules adopted pursuant to subdivision 2.  An 
insurer may refuse to renew an automobile insurance policy in 
case of nonpayment of dues to an association or organization, 
other than an insurance association or organization, where 
payment of dues is a prerequisite to obtaining or continuing 
such insurance; provided, however, that this provision for 
nonrenewal for failure to pay dues shall not be applicable to 
persons who are retired at age 62 years of age or older or who 
are disabled, according to social security standards. 
    No insurer shall take any action in regard to an automobile 
insurance policy on the statements or charges of any person made 
to the insurer concerning alleged unsafe driving habits of an 
insured unless the insurer shall concurrently disclose to the 
insured the name and address of the person from which the 
insurer received the information.  
    Sec. 59.  Minnesota Statutes 1982, section 65B.19, is 
amended to read: 
    65B.19 [NOTICE OF RIGHT TO COMPLAIN CANCELLATION OR 
NONRENEWAL.] 
     Subdivision 1.  [DISCLOSURE.] No insurer shall take any 
action in regard to an automobile insurance policy on the 
statements or charges of any person made to the insurer 
concerning alleged unsafe driving habits of an insured unless 
the insurer shall concurrently disclose to the insured the name 
and address of the person from which the information was 
received.  
    Subd. 2.  [NOTICE OF RIGHT TO COMPLAIN.] When the insurer 
notifies the policyholder of nonrenewal, cancellation or 
reduction in the limits of liability of coverage under sections 
65B.16 or 65B.17, the insurer shall also notify the named 
insured of his right to complain within 30 days of his receipt 
of notice of nonrenewal, cancellation or reduction in the limits 
of liability to the commissioner of such action and of the 
nature of and his possible eligibility for insurance through the 
Minnesota automobile insurance plan.  Such notice shall 
accompany or be included in the notice of nonrenewal, 
cancellation or reduction in the limits of liability of 
coverage, and shall state that such notice of the insured's 
right of complaint to the commissioner and of the availability 
of insurance through the Minnesota automobile insurance plan is 
given pursuant to sections 65B.14 to 65B.21.  
    Sec. 60.  Minnesota Statutes 1982, section 65B.43, 
subdivision 2, is amended to read: 
    Subd. 2.  "Motor vehicle" means every vehicle, other than a 
motorcycle or other vehicle with fewer than four wheels, which 
(a) is required to be registered pursuant to chapter 168, 
and (b) is designed to be self-propelled by an engine or motor 
for use primarily upon public roads, highways or streets in the 
transportation of persons or property, or (c) is and includes a 
trailer with one or more wheels, when the trailer is connected 
to or being towed by a motor vehicle. 
    Sec. 61.  Minnesota Statutes 1982, section 65B.43, 
subdivision 13, is amended to read: 
    Subd. 13.  "Motorcycle" means a self-propelled vehicle 
designed to travel on fewer than four wheels which has an engine 
rated at greater than five horsepower, and includes a trailer 
with one or more wheels, when the trailer is connected to or 
being towed by a motorcycle.  
    Sec. 62.  Minnesota Statutes 1982, section 65B.43, is 
amended by adding a subdivision to read: 
    Subd. 15.  "Plan of reparation security" means a contract, 
self-insurance, or other legal means under which there is an 
obligation to pay the benefits described in section 65B.49.  
    Sec. 63.  Minnesota Statutes 1982, section 67A.241, 
subdivision 2, is amended to read: 
    Subd. 2.  [EXTERNAL EXAMINATION OF COMPANY RECORDS AND 
ACCOUNTS.] (a) The board of directors of every township mutual 
insurance company shall, at least once every three years, cause 
the records and accounts of the company to be examined by an 
independent public accountant, auditor, or person who has been 
certified by the society of financial examiners.  The 
examination shall cover the financial and business affairs 
including the treatment of members and claimants of the company 
during the previous three years ending December 31.  
    (b) A written summary report of the pertinent results of 
the examination shall immediately be filed with each member of 
the board of directors following completion of the examination.  
A complete examination report shall be filed with the board of 
directors and the commissioner within 60 days following 
completion of the examination.  
    (c) The accountant, auditor, or certified financial 
examiner conducting or supervising the examination must have a 
minimum of five years' experience in public accounting or 
examining the financial records or statements of financial 
institutions and shall not be an officer, or employee, or member 
of the company being examined.  The examiner must not be 
directly involved in maintaining the records being examined, but 
may advise or counsel management in recordkeeping, accounting, 
or management procedures.  
    Sec. 64.  Minnesota Statutes 1983 Supplement, section 
69.011, subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITIONS.] Unless the language or 
context clearly indicates that a different meaning is intended, 
the following words and terms shall for the purposes of this 
chapter and chapters 423, 424 and 424A have the meanings 
ascribed to them: 
    (a) "Commissioner" means the commissioner or director of 
insurance revenue. 
    (b) "Municipality" means any home rule charter or statutory 
city, organized town or park district subject to chapter 398. 
    (c) "Minnesota Firetown Premium Report" means a form 
prescribed by the commissioner containing space for reporting by 
insurers of fire, lightning, sprinkler leakage and extended 
coverage premiums received upon risks located or to be performed 
in this state less return premiums and dividends. 
    (d) "Firetown" means the area serviced by any municipality 
having a qualified fire department or a qualified incorporated 
fire department having a subsidiary volunteer firefighters 
relief association. 
    (e) "Assessed Property Valuation" means latest available 
assessed value of all property in a taxing jurisdiction, whether 
the property is subject to taxation, or exempt from ad valorem 
taxation obtained from information which appears on abstracts 
filed with the commissioner of revenue or equalized by the state 
board of equalization. 
    (f) "Minnesota Aid to Police Premium Report" means a form 
prescribed by the commissioner for reporting by each fire and 
casualty insurer of all premiums received upon direct business 
received by it in this state, or by its agents for it, in cash 
or otherwise, during the preceding calendar year, with reference 
to insurance written for insuring against the perils contained 
in auto liability-bodily injury, auto liability-property damage, 
and auto physical damage as reported in the Minnesota business 
schedule of the fire and casualty insurance companies annual 
financial statement which each insurer is required to file with 
the commissioner in accordance with the governing laws or 
regulations less return premiums and dividends. 
      (g) "Peace officer" means any person: 
      (1) Whose primary source of income derived from wages is 
from direct employment by a municipality or county as a law 
enforcement officer on a full time basis of not less than 30 
hours per week; 
     (2) Who has been employed for a minimum of six months prior 
to December 31 preceding the date of the current year's 
certification pursuant to subdivision 2, clause (b); 
      (3) Who is sworn to enforce the general criminal laws of 
the state and local ordinances; 
      (4) Who is licensed by the peace officers standards and 
training board and is authorized to arrest with a warrant; and 
    (5) Who is a member of a local police relief association to 
which section 69.77 applies or the public employees police and 
fire fund. 
    (h) "Full time equivalent number of peace officers 
providing contract service" means the integral or fractional 
number of peace officers which would be necessary to provide the 
contract service if all peace officers providing service were 
employed on a full time basis as defined by the employing unit 
and the municipality receiving the contract service. 
    (i) "Retirement benefits other than a service pension"  
means any disbursement authorized pursuant to section 424.05, 
subdivision 3, clauses (2), (3) and (4).  
    (j) "Municipal clerk, municipal clerk-treasurer or county 
auditor" means the person who was elected or appointed to the 
specified position or, in the absence of the person, another 
person who is designated by the applicable governing body.  In a 
park district the clerk is the secretary of the board of park 
district commissioners. 
    Sec. 65.  Minnesota Statutes 1982, section 69.021, 
subdivision 1, is amended to read: 
    Subdivision 1.  [MINNESOTA FIRETOWN PREMIUM REPORT AND 
MINNESOTA AID TO POLICE PREMIUM REPORT.] The commissioner of 
insurance revenue shall, at the time he mails annual statement 
and tax forms, send blank copies of the Minnesota Firetown 
Premium Report and when applicable the Minnesota Aid to Police 
Premium Report to each insurer, including township and farmers 
mutual insurance companies licensed to write insurance as 
described in section 69.011, subdivision 1, clauses (c) and (f) 
in this state.  These reports shall contain space for the 
insurers name, address, gross premiums less return premiums, 
dividends, net premiums, certification and other facts the 
commissioner may require. 
    Sec. 66.  Minnesota Statutes 1982, section 69.021, 
subdivision 2, is amended to read: 
    Subd. 2.  [REPORT OF PREMIUMS.] Each insurer, including 
township and farmers mutual insurers where applicable, shall 
return to the commissioner of commerce with its annual financial 
statement the reports described in subdivision 1 certified by 
its secretary and president or chief financial officer.  The 
Minnesota Firetown Premium Report shall contain a true and 
accurate statement of the total premium for all gross direct 
fire, lightning, and sprinkler leakage insurance of all domestic 
mutual insurers and the total premiums for all gross direct 
fire, lightning, sprinkler leakage and extended coverage 
insurance of all other insurers, less return premiums and 
dividends received by them on that business written or done 
during the preceding calendar year upon property located within 
the state or brought into the state for temporary use.  The fire 
and extended coverage portion of multi-peril and multiple peril 
package premiums and all other combination premiums shall be 
determined by applying percentages determined by the 
commissioner of commerce or by rating bureaus recognized by the 
commissioner of commerce.  The Minnesota Aid to Police Premium 
Report shall contain a true and accurate statement of the total 
premiums, less return premiums and dividends received, on all 
direct business received by such insurer in this state, or by 
its agents for it, in cash or otherwise, during the preceding 
calendar year, with reference to insurance written for perils 
described in section 69.011, subdivision 1, clause (f). 
    Each insurer shall, in addition to filing with the 
commissioner of commerce the reports required by this 
subdivision, file the reports required by this subdivision with 
the commissioner of revenue. 
    Sec. 67.  Minnesota Statutes 1982, section 69.021, 
subdivision 3, is amended to read: 
    Subd. 3.  [PENALTY FOR FRAUDULENT, INCORRECT, INCOMPLETE 
RETURNS AND LATE FILING OF REPORT WITH THE COMMISSIONER OF 
COMMERCE.] When it appears to the commissioner of commerce that 
any insurer has made an incomplete or inaccurate report the 
commissioner of commerce shall return the report and demand that 
a complete and accurate report be filed with him.  If the 
insurer fails to file a report by March 1, annually, or within 
30 days after demand by the commissioner of commerce, the 
insurer shall be liable and shall pay $25 for each seven days 
delinquent or fraction thereof. 
    Any insurer who knowingly makes and files an inaccurate or 
false report shall be liable to a fine of not less than $25 nor 
more than $1,000 and the commissioner of commerce may revoke the 
insurer's certificate of authority. 
    If any person whose duty it is to make the report fails or 
refuses to make it within 30 days after notification by the 
commissioner of commerce he shall be fined not more than $1,000. 
Failure of the insurer to receive a reporting form shall not 
excuse the insurer from filing the report. 
    Sec. 68.  Minnesota Statutes 1982, section 69.021, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [PENALTY FOR FRAUDULENT, INCORRECT, INCOMPLETE 
RETURNS AND LATE FILING OF REPORT WITH THE COMMISSIONER OF 
REVENUE.] When it appears that any insurer has made an 
incomplete or inaccurate report to the commissioner of revenue, 
the commissioner shall return the report and demand that a 
complete and accurate report be filed.  If the insurer fails to 
file a report by March 1, annually, or within 60 days after 
demand by the commissioner the insurer shall be subject to 
penalties and interest as provided in section 290.53, 
subdivision 2. 
    Any insurer who knowingly makes and files an inaccurate or 
false report shall be liable for penalties and interest as 
provided in section 290.53, subdivision 3.  The commissioner of 
commerce may revoke the insurer's certificate of authority. 
    Failure of the insurer to receive a reporting form shall 
not excuse the insurer from filing the report.  
    Sec. 69.  Minnesota Statutes 1982, section 69.58, is 
amended to read: 
    69.58 [INSURING IN UNAUTHORIZED COMPANIES; DUES; 
STATEMENT.] 
    The owner of any property situated in any municipality 
having an organized fire department, or a partly paid or 
volunteer department, who carries insurance in a company not 
licensed by this state, or if he has not insured his property, 
who sets aside a reserve against loss or damage by fire, shall 
furnish to the commissioner of revenue, on a form prescribed and 
furnished by the commissioner, a statement, verified by 
affidavit, showing the description and location of the property, 
the amount of insurance, in companies not licensed by this 
state, he has effected against loss or damage by fire, the 
number of the policy, the name and location of the company 
issuing the policy, and the premiums paid; or, if he has not 
insured his property, the amount paid into or credited to any 
insurance fund or other reserve against loss or damage by fire.  
This statement shall be furnished by those property owners 
carrying insurance in companies not licensed by this state not 
more than 30 days after the issuance of the policy of insurance, 
and by those property owners not carrying insurance but having 
an insurance or other reserve fund against loss or damage by 
fire, upon demand of the commissioner, or, if no demand is made, 
then on or before January 31st, each year.  Every such property 
owner whose duty it is to make this statement who shall wilfully 
make a false statement, or who shall, for 30 days after the 
demand neglect to render the statement, shall be guilty of a 
misdemeanor and fined $50, one-half of which fine shall be 
transmitted to the commissioner and disbursed by him as other 
sums collected under the terms of sections 69.58 to 69.61 are 
disbursed. 
    Sec. 70.  Minnesota Statutes 1982, section 69.59, is 
amended to read: 
    69.59 [COLLECTION OF PERCENTAGE ON PREMIUM; RECOVERY.] 
    If the insurance has been effected in any company not 
authorized to do business in this state, or if the owner carries 
his own insurance fund or reserves, the commissioner of revenue 
shall, and he is hereby authorized and empowered to, collect 
from the property owner such taxes as would equal the taxes on 
the annual premium which authorized insurance companies would 
have charged for insuring the property.  If not paid upon 
demand, this percent may be recovered in a civil action brought 
in the name of the state.  Penalties and interest as provided in 
section 290.53 shall be imposed.  
    Sec. 71.  Minnesota Statutes 1982, section 72A.061, 
subdivision 2, is amended to read: 
    Subd. 2.  [ARTICLES OF INCORPORATION; BYLAWS.] Any 
insurance company licensed to do business in this state, 
including fraternals and township mutuals, which neglects to 
file amended bylaws or related amendments within 30 days after 
date of approval by shareholders or members of the company shall 
be subject to a penalty of $25 for each day in default. 
    Any insurance company licensed to do business in this 
state, including fraternals and township mutuals, which neglects 
to file amended articles of incorporation or related amendments 
within 30 days after date of approval by shareholders or members 
of the company shall be subject to a penalty of $25 for each day 
in default, provided that foreign insurers shall be allowed 60 
days in which to file. 
    If after 90 days the filings required under this 
subdivision are still in default, the company shall be given ten 
days in which to show cause why its license should not be 
suspended. 
    Sec. 72.  Minnesota Statutes 1982, section 72A.07, is 
amended to read: 
    72A.07 [VIOLATIONS OF LAWS RELATING TO AGENTS, PENALTIES.] 
    Any person, firm, or corporation violating, or failing to 
comply with, any of the provisions of section 60A.17 and any 
person who acts in any manner in the negotiation or transaction 
of unlawful insurance with an insurance company not licensed to 
do business in the state, or who, as principal or agent, 
violates any provision of law relating to the negotiation or 
effecting of contracts of insurance, shall be guilty of a 
misdemeanor.  Upon the filing of a complaint by the commissioner 
of insurance in a court of competent jurisdiction against any 
person violating any provisions of this section, the county 
attorney of the county in which the violation occurred shall 
prosecute the person.  Upon the conviction of any agent or 
solicitor of any violation of the provisions of section 60A.17, 
the commissioner shall suspend the authority of the agent or 
solicitor to transact any insurance business within the state 
for a period of not less than three months.  Any insurer 
employing an agent and failing to procure a license an 
appointment, as required by section 60A.17, or allowing the 
agent to transact business for it within the state before a 
license an appointment has been procured, shall pay the 
commissioner, for the use of the state, a penalty of $25 for 
each offense.  Each sale of an insurance policy by an unlicensed 
agent who is not appointed by an insurance company shall 
constitute a separate offense, but no insurer shall be required 
to pay more than $300 in penalties as a result of the activities 
of a single unlicensed unappointed agent. In the event of 
failure to pay a penalty within ten days after notice from the 
commissioner, the authority of the insurer to do business in 
this state shall be revoked by the commissioner until the 
penalty is paid.  No insurer whose authority is revoked shall be 
readmitted until it shall have complied with all the terms and 
conditions imposed for admission in the first instance.  Any 
action taken by the commissioner under this section shall be 
subject to review by the district court of the county in which 
the office of the commissioner is located. 
    Sec. 73.  Minnesota Statutes 1982, section 72A.20, is 
amended by adding a subdivision to read: 
    Subd. 16.  [DISCRIMINATION BASED ON SEX OR MARITAL STATUS.] 
Refusing to insure, refusing to continue to insure, refusing to 
offer or submit an application for coverage, or limiting the 
amount of coverage available to an individual because of the sex 
or marital status of the individual; however, nothing in this 
subsection prohibits an insurer from taking marital status into 
account for the purpose of defining persons eligible for 
dependents' benefits.  
    Sec. 74.  Minnesota Statutes 1982, section 72A.23, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DETERMINATION BY COMMISSIONER; FINDINGS.] 
Whenever it appears to the commissioner that any person has 
engaged or is about to engage in any act or practice 
constituting a violation of this chapter or any rule or order 
under this chapter, he may issue and cause to be served upon the 
person an order requiring the person to cease and desist from 
violations of section 72A.19 or 72A.20.  The order must be 
calculated to give reasonable notice of the rights of the person 
to request a hearing thereon and must state the reasons for the 
entry of the order.  A hearing shall be held not later than 
seven days after the request for the hearing is received by the 
commissioner after which and within 20 days of the date of the 
hearing the commissioner shall issue a further order vacating 
the cease and desist order or making it permanent as the facts 
require.  If no hearing is requested within 30 days of service 
of the order, the order will become final and will remain in 
effect until it is modified or vacated by the commissioner.  All 
hearings shall be conducted in accordance with chapter 14.  If 
the person to whom a cease and desist order is issued fails to 
appear at the hearing after being duly notified, the person 
shall be deemed in default, and the proceeding may be determined 
against him upon consideration of the cease and desist order, 
the allegations of which may be deemed to be true.  If, after a 
hearing, as provided in section 72A.22, the commissioner shall 
determine that the method of competition or the act or practice 
in question is defined in section 72A.20 or any rules adopted 
pursuant to section 72A.19 or 72A.20, and that the person 
complained of has engaged in that method of competition, act, or 
practice, in violation of sections 72A.17 to 72A.32 he shall 
reduce his findings to writing and shall issue and cause to be 
served upon the person charged with the violation an order 
requiring him to cease and desist from engaging in that method 
of competition, act or practice, and may impose a civil penalty 
of not more than $2,000 for each offense.  If the commissioner 
determines that an insurer has engaged in an act or practice 
defined in section 72A.20, subdivision 13, the cease and desist 
order may also require the insurer to write or renew the 
homeowner's insurance coverage sought by the insured or 
prospective insured for a specified period of up to three years 
without cancellation or nonrenewal by the insurer for a reason 
not specified in section 65A.01; after the specified period 
expires, cancellation or nonrenewal of the coverage may be made 
only as permitted by law. 
    Sec. 75.  Minnesota Statutes 1982, section 72B.04, 
subdivision 7, is amended to read: 
    Subd. 7.  [LICENSE TERM.] Every adjuster's and public 
adjuster solicitor's license shall be for a term expiring on 
December May 31 next following the date of its issuance, and may 
be renewed for the ensuing calendar year upon the timely filing 
of an application for renewal. 
    Sec. 76.  Minnesota Statutes 1982, section 72B.04, 
subdivision 10, is amended to read: 
    Subd. 10.  [FEES.] A fee of $10 $20 is imposed for each 
initial license or temporary permit and $2 $20 for each renewal 
thereof or amendment thereto.  A fee of $10 $20 is imposed for 
each examination taken.  A fee of $2 $20 is imposed for the 
registration of each non-licensed adjuster who is required to 
register under section 72B.06.  All fees shall be transmitted to 
the commissioner and shall be payable to the state treasurer.  
If a fee is paid for an examination and if within one year from 
the date of that payment no written request for a refund is 
received by the commissioner or the examination for which the 
fee was paid is not taken, the fee is forfeited to the state of 
Minnesota. 
    Sec. 77.  Minnesota Statutes 1982, section 79.10, is 
amended to read: 
    79.10 [REVIEW OF ACTS OF INSURERS.] 
    The insurance division staff may investigate on the request 
of any person or on its own initiative the acts of the rating 
association, an insurer, or an agent that are subject to 
provisions of sections 79.01 to 79.23 chapter 79 and may make 
findings and recommendations that the commissioner issue an 
order requiring compliance with the provisions thereof.  The 
proposed findings and recommended order shall be served on all 
affected parties at the same time that the staff transmits its 
findings and recommendations to the commissioner.  Any party 
adversely affected by the proposed findings and recommended 
order may request that a hearing be held concerning the issues 
raised therein within 15 days after service of the findings and 
recommended order.  This hearing shall be conducted as a 
contested case pursuant to sections 14.01 to 14.70.  If a 
hearing is not requested within the time specified in this 
section, the proposed findings and recommended order may be 
adopted by the commissioner as a final order.  
    Sec. 78.  Minnesota Statutes 1983 Supplement, section 
79.37, is amended to read: 
    79.37 [BOARD OF DIRECTORS.] 
    A board of directors of the reinsurance association is 
created and is responsible for the operation of the reinsurance 
association consistent with the plan of operation and sections 
79.34 to 79.42.  The board consists of 13 directors and the 
commissioners of insurance and labor and industry who shall be 
ex officio members.  Four members of the board directors shall 
represent insurers, six members of the board directors shall 
represent employers, at least one, but not more than three, of 
whom shall represent self-insurers,; and three members of the 
board directors shall represent employees.  Members of the 
reinsurance association shall elect the insurer directors, who 
represent insurers and the commissioner of insurance commerce 
shall appoint the employer directors who represent employers and 
employee directors from a list presented to the commissioner by 
the workers' compensation advisory council established in 
chapter 175, employees for the terms authorized in the plan of 
operation.  Each board member director is entitled to one vote.  
Terms of the directors shall be staggered so that the terms of 
all the directors do not expire at the same time and so that a 
director does not serve a term of more than four years.  The 
board shall select a chairman and other officers it deems 
appropriate. 
    A majority of the board directors currently holding office 
constitutes a quorum, notwithstanding any vacancies.  Action may 
be taken by a majority vote of the directors present. 
    Sec. 79.  Minnesota Statutes 1982, section 79.39, is 
amended to read:  
    79.39 [APPLICABILITY OF CHAPTER 79.] 
    Subdivision 1.  [EXAMINATION BY COMMISSIONER.] The 
reinsurance association is subject to all the provisions of this 
chapter.  The commissioner or an authorized representative of 
the commissioner may visit the reinsurance association at any 
time and examine, audit, or evaluate the reinsurance 
association's operations, records and practices.  For purposes 
of this section, "authorized representative of the commissioner" 
includes employees of the department of commerce or other 
parties retained by the commissioner.  
    Subd. 2.  [COSTS AND EXPENSES.] The commissioner may order 
and the reinsurance association shall pay the costs and expenses 
of any examination, audit, or evaluation conducted pursuant to 
subdivision 1.  
    Sec. 80.  Minnesota Statutes 1982, section 176.181, 
subdivision 2, is amended to read: 
    Subd. 2.  [COMPULSORY INSURANCE; SELF-INSURERS.] (1) Every 
employer, except the state and its municipal subdivisions, 
liable under this chapter to pay compensation shall insure 
payment of compensation with some insurance carrier authorized 
to insure workers' compensation liability in this state, or 
obtain a written order from the commissioner of insurance 
exempting the employer from insuring his liability for 
compensation and permitting him to self-insure the liability.  
The terms, conditions and requirements governing self-insurance 
shall be established by the commissioner pursuant to chapter 
14.  The commissioner of insurance shall also adopt, pursuant to 
clause (2)(c), rules permitting two or more employers, whether 
or not they are in the same industry, to enter into agreements 
to pool their liabilities under this chapter for the purpose of 
qualifying as group self-insurers.  With the approval of the 
commissioner of insurance, any employer may exclude medical, 
chiropractic and hospital benefits as required by this chapter.  
An employer conducting distinct operations at different 
locations may either insure or self-insure the other portion of 
his operations which may be determined by the commissioner of 
insurance to be as a distinct and separate risk.  An employer 
desiring to be exempted from insuring his liability for 
compensation shall make application to the commissioner of 
insurance, showing his financial ability to pay the 
compensation, whereupon by written order the commissioner of 
insurance may make an exemption as he deems proper.  The 
commissioner of insurance may require further statements of 
financial ability of the employer to pay compensation.  Upon ten 
days written notice the commissioner of insurance may revoke his 
order granting an exemption, in which event the employer shall 
immediately insure his liability.  As a condition for the 
granting of an exemption the commissioner of insurance may 
require the employer to furnish security the commissioner of 
insurance considers sufficient to insure payment of all claims 
under this chapter.  If the required security is in the form of 
currency or negotiable bonds, the commissioner of insurance 
shall deposit it with the state treasurer.  In the event of any 
default upon the part of a self-insurer to abide by any final 
order or decision of the commissioner of labor and industry 
directing and awarding payment of compensation and benefits to 
any employee or the dependents of any deceased employee, then 
upon at least ten days notice to the self-insurer, the 
commissioner of insurance may by written order to the state 
treasurer require him to sell the pledged and assigned 
securities or a part thereof necessary to pay the full amount of 
any such claim or award with interest thereon.  This authority 
to sell may be exercised from time to time to satisfy any order 
or award of the commissioner of labor and industry or any 
judgment obtained thereon.  When securities are sold the money 
obtained shall be deposited in the state treasury to the credit 
of the commissioner of insurance and awards made against any 
such self-insurer by the commissioner of insurance shall be paid 
to the persons entitled thereto by the state treasurer upon 
warrants prepared by the commissioner of insurance and approved 
by the commissioner of finance out of the proceeds of the sale 
of securities.  Where the security is in the form of a surety 
bond or personal guaranty the commissioner of insurance, at any 
time, upon at least ten days notice and opportunity to be heard, 
may require the surety to pay the amount of the award, the 
payments to be enforced in like manner as the award may be 
enforced. 
     (2)(a) No association, corporation, partnership, sole 
proprietorship, trust or other business entity shall provide 
services in the design, establishment or administration of a 
group self-insurance plan under rules adopted pursuant to this 
subdivision unless it is licensed to do so by the commissioner 
of insurance.  An applicant for a license shall state in writing 
the type of activities it seeks authorization to engage in and 
the type of services it seeks authorization to provide.  The 
license shall be granted only when the commissioner of insurance 
is satisfied that the entity possesses the necessary 
organization, background, expertise, and financial integrity to 
supply the services sought to be offered.  The commissioner of 
insurance may issue a license subject to restrictions or 
limitations, including restrictions or limitations on the type 
of services which may be supplied or the activities which may be 
engaged in.  The license is for a two year period. 
     (b) To assure that group self-insurance plans are 
financially solvent, administered in a fair and capable fashion, 
and able to process claims and pay benefits in a prompt, fair 
and equitable manner, entities licensed to engage in such 
business are subject to supervision and examination by the 
commissioner of insurance. 
     (c) To carry out the purposes of this subdivision, the 
commissioner of insurance may promulgate administrative rules, 
including emergency rules, pursuant to sections 14.01 to 14.70.  
These rules may: 
     (i) establish reporting requirements for administrators of 
group self-insurance plans; 
     (ii) establish standards and guidelines to assure the 
adequacy of the financing and administration of group 
self-insurance plans; 
     (iii) establish bonding requirements or other provisions 
assuring the financial integrity of entities administering group 
self-insurance plans; 
     (iv) establish standards, including but not limited to 
minimum terms of membership in self-insurance plans, as 
necessary to provide stability for those plans; 
    (v) establish standards or guidelines governing the 
formation, operation, administration and dissolution of 
self-insurance plans; and 
    (vi) establish other reasonable requirements to further the 
purposes of this subdivision. 
    Sec. 81.  Minnesota Statutes 1982, section 176.181, is 
amended by adding a subdivision to read: 
    Subd. 7.  [PENALTY.] Any entity that is self-insured 
pursuant to subdivision 2, and that knowingly violates any 
provision of subdivision 2 or any rule adopted pursuant thereto 
is subject to a civil penalty of not more than $5,000 for each 
offense.  
    Sec. 82.  Minnesota Statutes 1982, section 271.01, 
subdivision 5, is amended to read: 
    Subd. 5.  [JURISDICTION.] The tax court shall have 
statewide jurisdiction.  Except for an appeal to the supreme 
court or any other appeal allowed under this subdivision, the 
tax court shall be the sole, exclusive, and final authority for 
the hearing and determination of all questions of law and fact 
arising under the tax laws of the state, as defined in this 
subdivision, in those cases that have been appealed to the tax 
court and in any case that has been transferred by the district 
court to the tax court.  The tax court shall have no 
jurisdiction in any case that does not arise under the tax laws 
of the state or in any criminal case or in any case determining 
or granting title to real property or in any case that is under 
the jurisdiction of the probate court.  The small claims 
division of the tax court shall have no jurisdiction in any case 
dealing with property valuation or assessment for property tax 
purposes until the taxpayer has appealed the valuation or 
assessment to the town or city board of equalization and to the 
county board of equalization, except for those taxpayers whose 
original assessments are determined by the commissioner of 
revenue.  The tax court shall have no jurisdiction in any case 
involving an order of the state board of equalization unless a 
taxpayer contests the valuation of his property.  Only the 
taxes, aids and related matters contained in chapters 60A, 69, 
124, 270, 272, 273, 274, 275, 276, 277, 278, 279, 285, 287, 288, 
290, 290A, 291, 292, 293, 294, 295, 296, 297, 297A, 297B, 298, 
299, 299F, 340, 473, 473F, and 477A shall be considered tax laws 
of this state subject to the jurisdiction of the tax court.  
This subdivision shall not be construed to prevent an appeal, as 
provided by law, to an administrative agency, board of 
equalization, or to the commissioner of revenue.  Wherever used 
in chapter 271, the term commissioner shall mean the 
commissioner of revenue, unless otherwise specified. 
    Sec. 83.  Minnesota Statutes 1982, section 299F.21, is 
amended to read: 
    299F.21 [FIRE INSURANCE COMPANIES TO PAY COST OF 
MAINTENANCE.] 
    Every insurance company, including reciprocals, 
interinsurance exchanges or Lloyds, doing business in the state, 
excepting farmers' mutual fire insurance companies and township 
mutual fire insurance companies, shall hereafter pay to the 
state treasurer commissioner of revenue on or before March 1 
annually, a tax upon its fire premiums or assessments or both, 
as follows: 
    A sum equal to one-half of one percent of the gross 
premiums and assessments, less return premiums, on all direct 
business received by it in this state, or by its agents for it, 
in cash or otherwise, during the preceding calendar year, 
including premiums on policies covering fire risks only on 
automobiles, whether written under floater form or otherwise.  
In the case of a mutual company or reciprocal exchange the 
dividends or savings paid or credited to members in this state 
shall be construed to be return premiums.  The money so received 
into the state treasury shall be credited to the general fund. 
    If the tax prescribed by this section is not paid by March 
1, annually, a penalty of ten percent shall accrue on the tax, 
and thereafter the tax and penalty shall draw interest at the 
rate of one percent per month until paid penalties and interest 
as provided in section 290.53, subdivision 1, shall be imposed. 
    Sec. 84.  Minnesota Statutes 1982, section 299F.22, is 
amended to read: 
    299F.22 [EXAMINATION OF RETURNS; ASSESSMENT; RETURNS.] 
    The commissioner of insurance revenue shall, as soon as 
practicable after a return required by section 299F.21 is filed, 
examine the same and make any investigation or examination of 
the company's records and accounts that he deems necessary for 
determining the correctness of the return.  The tax computed by 
him on the basis of the examination and investigation is the tax 
to be paid by the company.  If the tax found due is greater than 
the amount reported as due on the company's return, the 
commissioner shall assess a tax in the amount of the excess and 
the whole amount of the excess shall be paid to the state 
treasurer within 30 60 days after notice of the amount and 
demand for its payment is mailed to the company by the 
commissioner.  If the understatement of the tax on the return 
was false and fraudulent with intent to evade the tax, the 
installments of the tax shown by the company on its return which 
are not paid shall be paid to the state treasurer commissioner 
of revenue within 30 60 days after notice of the amount thereof 
and demand for payment is mailed to the company by the 
commissioner.  If the amount of the tax found due the 
commissioner is less than that reported as due on the company's 
return, the excess shall be refunded to the company in the 
manner provided by section 299F.26, except that no demand 
therefor is necessary, if they have already paid the whole of 
the tax, or credited against any unpaid installment thereof; 
provided, that no refundment shall be made except as provided in 
section 299F.26, after the expiration of three and one-half 
years after the filing of the return. 
    If the commissioner examines returns of a company for more 
than one year, he may issue one order covering the several years 
under consideration reflecting the aggregate refund or 
additional tax due. 
    The notices and demands provided for by sections 299F.22 to 
299F.24 shall be in the form the commissioner determines, 
including a statement, and shall contain a brief explanation of 
the computation of the tax and shall be sent by mail to the 
company at the address given in its return, if any, and if no 
such address is given, then to the last known address. 
    Sec. 85.  Minnesota Statutes 1982, section 299F.23, is 
amended to read: 
    299F.23 [ASSESSMENT, FAILURE TO FILE RETURN; FALSE OR 
FRAUDULENT RETURN FILED; PENALTIES.] 
    Subdivision 1.  [FAILURE TO FILE; FALSE OR FRAUDULENT 
RETURN.] If any company required by section 299F.21 to file any 
return fails to do so within the time prescribed or makes, 
wilfully or otherwise, an incorrect, false, or fraudulent 
return, it shall, on the written demand of the commissioner of 
insurance revenue, file the return, or corrected return, within 
30 60 days after the mailing of the written demand and at the 
same time pay the whole tax, or additional tax, due on the basis 
thereof.  If the company fails within that time to file the 
return, or corrected return, the commissioner shall make for it 
a return or corrected return, from his own knowledge and from 
the information he can obtain through testimony, or otherwise, 
and assess a tax on the basis thereof, which tax, less any 
payments theretofore made on account of the tax for the taxable 
year covered by the return, shall be paid within ten 60 days 
after the commissioner has mailed to the company a written 
notice of the amount thereof and demand for its payment.  Any 
return or assessment made by the commissioner on account of the 
failure of the company to make a return, or a corrected return, 
is prima facie correct and valid, and the company has the burden 
of establishing its incorrectness or invalidity in any action or 
proceeding in respect thereto. 
    Subd. 2.  [FAILURE TO FILE; PENALTIES AND INTEREST.] In 
case of any failure to make and file a return as required by 
this chapter within the time prescribed by law or prescribed by 
the commissioner of revenue in pursuance of law there shall be 
added to the tax penalties and interest as provided in section 
290.53, subdivision 2.  
    Subd. 3.  [INTENT TO EVADE TAX; PENALTY.] If any company 
with intent to evade the tax imposed by this chapter, fails to 
file any return required by this chapter or with such intent 
files a false or fraudulent return there shall also be imposed 
on it a penalty as provided in section 290.53, subdivision 3.  
    Subd. 4.  [NEGLIGENCE OR INTENTIONAL DISREGARD; PENALTY.] 
If any part of any additional assessment is due to negligence or 
intentional disregard of the statute or a rule (but without 
intent to defraud), there shall be added to the tax a penalty as 
provided in section 290.53, subdivision 3a.  
    Sec. 86.  Minnesota Statutes 1982, section 299F.24, is 
amended to read: 
    299F.24 [COLLECTION OF TAX.] 
    The tax required to be paid by section 299F.21, may be 
collected in any ordinary action at law by the commissioner of 
insurance revenue against the company.  In any action commenced 
pursuant to this section, upon the filing of an affidavit of 
default, the clerk of the district court wherein the action was 
commenced shall enter judgment for the state for the amount 
demanded in the complaint together with costs and disbursements. 
    Sec. 87.  Minnesota Statutes 1982, section 299F.26, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PROCEDURE, TIME LIMIT, APPROPRIATION.] A 
company which has paid, voluntarily or otherwise, or from which 
there was collected an amount of tax for any year in excess of 
the amount legally due for that year, may file with the 
commissioner of insurance revenue a claim for a refund of the 
excess. Except as provided in subdivision 4, no claim shall be 
entertained unless filed within two years after the tax was paid 
or collected, or within three and one-half years from the filing 
of the return, whichever period is the longer or refund shall be 
allowed or made after 3-1/2 years from the date prescribed for 
filing the return (plus any extension of time granted for filing 
the return but only if filed within the extended time) or after 
two years from the date of overpayment, whichever period is 
longer, unless before the expiration of the period a claim is 
filed by the company.  For this purpose a return or amended 
return claiming an overpayment constitutes a claim for refund. 
    Upon the filing of a claim the commissioner shall examine 
the same and shall make and file written findings thereon 
denying or allowing the claim in whole or in part and shall mail 
a notice thereof to the company at the address stated upon the 
return.  If such claim is allowed in whole or in part, the 
commissioner shall issue his certificate for the refundment of 
the excess paid by the company, with interest at the rate of two 
six percent per annum computed from the date of the payment or 
collection of the tax until the date the refund is paid or the 
credit is made to the company, and the commissioner of finance 
shall cause the refund to be paid as other state moneys are 
expended.  So much of the proceeds of the taxes as is necessary 
are appropriated for that purpose. 
    Sec. 88.  Minnesota Statutes 1982, section 299F.26, 
subdivision 2, is amended to read: 
    Subd. 2.  [DENIAL OF CLAIM, COURT PROCEEDINGS.] If the 
claim is denied in whole or in part, the company may commence an 
action against the commissioner to recover any overpayments of 
taxes claimed to be refundable but for which the commissioner 
has issued no certificate of refundment commissioner of revenue 
shall mail an order of denial to the company in the manner 
prescribed in section 299F.22.  An appeal from this order may be 
taken to the Minnesota tax court in the manner prescribed in 
section 271.06, or the company may commence an action against 
the commissioner to recover the denied overpayment.  The action 
may be brought in the district court of the district in which 
lies the county of its principal place of business, or in the 
district court for Ramsey county.  The action in the district 
court must be commenced within 18 months following the mailing 
of the order of denial to the company.  If a claim for refund is 
filed by a company and no order of denial is issued within six 
months of the filing, the company may commence an action in the 
district court as in the case of a denial, but the action must 
be commenced within two years of the date that the claim for 
refund was filed. 
    Sec. 89.  Minnesota Statutes 1982, section 424.165, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SURCHARGE.] When the balance in the 
special fund of any firefighter's relief association in any city 
of the second class is less than $50,000 as determined by any 
such association's board of trustees, which fact shall be duly 
certified to by the state auditor, such board of trustees may 
thereupon file its duly verified petition for relief, 
accompanied by such certificate, with the commissioner of 
insurance revenue.  The commissioner of insurance revenue shall 
thereupon order and direct a surcharge to be collected of two 
percent of the fire, lightning and sprinkler leakage gross 
premiums, less return premiums, on all direct business received 
by any foreign or domestic fire insurance company on property in 
such city of the second class, or by its agents for it, in cash 
or otherwise, until the balance in the special funds of such 
relief association amounts to $50,000 and for a period of 15 
days thereafter. As soon as the balance in said special fund 
amounts to $50,000 the board of trustees of such relief 
association shall certify that fact to the commissioner of 
insurance revenue and the commissioner of insurance revenue 
shall forthwith issue his order ordering and directing that the 
collection of such surcharge shall be discontinued after the 
expiration of said 15-day period and shall forthwith mail a copy 
of the order last mentioned to each insurance company affected 
thereby. Said surcharge shall be due and payable from such 
companies to the state treasurer in semi-annual installments on 
June 30 and December 31 of each calendar year to be kept by the 
state treasurer in a separate fund and if not paid within 30 
days after such dates a penalty of three percent shall accrue 
thereon and thereafter such sum and penalty shall draw interest 
at the rate of one percent per month until paid. 
    Sec. 90.  Minnesota Statutes 1982, section 574.32, is 
amended to read: 
    574.32 [NOTICE.] 
    The commissioner of insurance commerce or the county 
auditor in whose office the written notice is filed shall, upon 
receipt of such written notice, mail one copy of the same, by 
certified mail, to the principal contractor, at his last known 
address, and to each of the sureties on his bond, at their last 
known addresses, and the claimant shall, at the time he files 
the written notice, furnish the commissioner of insurance or the 
county auditor in whose office the notice is filed, at least two 
three copies of the notice.  The commissioner of insurance 
commerce or county auditor with whom the notice is filed shall 
be entitled to charge a fee of $5 $15 for filing the notice and 
may also charge a fee to cover the cost of mailing the copies as 
herein provided. The failure of the commissioner of insurance or 
the county auditor with whom the notice is filed to mail these 
copies as herein provided, shall in no way affect the validity 
of the claim or the right of the claimant to maintain an action 
thereon. 
    Sec. 91.  [TRANSFER OF FUNCTIONS.] 
    Effective July 1, 1983, the audit and direct aids section 
of the insurance division of the department of commerce is 
transferred to the department of revenue.  The amount of 
$144,100 and a complement of five positions shall be transferred 
from the department of commerce to the department of revenue for 
fiscal year 1985 to implement the transfer.  
    Sec. 92.  [APPROPRIATION.] 
    The sum of $62,400 is appropriated from the general fund to 
the department of commerce for the fiscal year ending June 30, 
1985.  
    The approved complement of the department is increased by 
two.  
    The appropriation is for the purpose of paying for the 
increased complement and the expenses related to the processing 
of forms and rates filed with the department.  
    Sec. 93.  [ATTORNEY GENERAL.] 
    The approved complement of the attorney general for general 
positions is increased by one.  $31,000 is added to the 
appropriation in Laws 1981, chapter 356, section 14, and is 
available until June 30, 1985.  
    Sec. 94.  [REPEALER.] 
    (a) Minnesota Statutes 1982, sections 65B.15, subdivision 3;
and 65B.48, subdivision 8, are repealed.  
    (b) Minnesota Statutes 1982, section 69.031, subdivision 6, 
is repealed.  
    Sec. 95.  [EFFECTIVE DATE.] 
    Sections 7, 10 to 27, 40, 41, 67 to 70, 82 to 89, 91, and 
94, paragraph (b) are effective for taxable years beginning 
after June 30, 1983, except as otherwise specifically provided. 
The remaining sections, except section 92, are effective the day 
following final enactment. 
    Approved April 26, 1984