2001 Minnesota Statutes

CHAPTER 60K. Insurance producers

     60K.01 Definitions. 

    Unless the language or context clearly indicates that a 
 different meaning is intended, the definitions in section 60A.01 
 are applicable to this chapter. 

    HIST: 1992 c 564 art 3 s 3 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.02 Insurance agents; solicitors license. 

    Subdivision 1.    Requirement.  No person shall act or 
 assume to act as an insurance agent in the solicitation or 
 procurement of applications for insurance, nor in the sale of 
 insurance or policies of insurance, nor in any manner aid as an 
 insurance agent in the negotiation of insurance by or with an 
 insurer, including resident agents or reciprocal or 
 interinsurance exchanges and fraternal benefit societies, until 
 that person obtains from the commissioner a license for that 
 purpose.  The license must specifically set forth the name of 
 the person authorized to act as an agent and the class or 
 classes of insurance for which that person is authorized to 
 solicit or countersign policies.  An insurance agent may qualify 
 for a license to sell:  (1) life and health; (2) life and health 
 and variable contracts; (3) property and casualty; (4) travel 
 baggage; (5) bail bonds; (6) title insurance; and (7) farm 
 property and liability.  

    No insurer shall appoint or reappoint a natural person, 
 partnership, or corporation to act as an insurance agent on its 
 behalf until that natural person, partnership, or corporation 
 obtains a license as an insurance agent.  

    Subd. 2.    Partnerships and corporations.  A license 
 issued to a partnership or corporation must be solely in the 
 name of the entity to which it is issued; provided that each 
 partner, director, officer, stockholder, or employee of the 
 licensed entity who is personally engaged in the solicitation or 
 negotiation of a policy of insurance on behalf of the licensed 
 entity shall be personally licensed as an insurance agent.  

    Upon request by the commissioner, each partnership and 
 corporation licensed as an insurance agent shall provide the 
 commissioner with a list of the names of each partner, director, 
 officer, stockholder, and employee who is required to hold a 
 valid insurance agent's license.  

    Subd. 3.    Transition.  (a) Any agent who is qualified 
 for life or accident and health as of June 1, 1981, is qualified 
 for a life and health license under Laws 1981, chapter 307, and 
 is appointed by an insurer which has submitted a written 
 requisition for a license for that agent as of June 1, 1981.  

    (b) Any agent who is qualified for one or more lines of 
 insurance, excluding life or accident and health and farm 
 property liability as of June 1, 1981, is qualified for a 
 property and casualty license under Laws 1981, chapter 307, and 
 is appointed by any insurer which has submitted a written 
 requisition for a license for that agent as of June 1, 1981.  

    Subd. 4.    Criminal penalties.  A person who acts or 
 assumes to act as an insurance agent without a valid license 
 issued by the commissioner is guilty of a gross misdemeanor.  

    HIST: 1992 c 564 art 3 s 4; 1999 c 177 s 29 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.03 License application. 

    Subdivision 1.    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.  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 (6), at the 
 time the agent becomes licensed.  The application and 
 appointment must 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.  

    Subd. 2.    Resident agent.  The commissioner shall 
 issue a resident insurance agent's license to a qualified 
 resident of this state as follows:  

    (a) 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 constitutes an election of residency in this 
 state.  A license issued upon an application claiming residency 
 in this state is 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. 

    (b) 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 must 
 be held at a reasonable time and place designated by the 
 commissioner. 

    (c) 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. 

    (d) The examination shall be given only after the applicant 
 has completed a program of classroom studies in a school, which 
 shall not include a school sponsored by, offered by, or 
 affiliated with an insurance company or its agents; except that 
 this limitation does not preclude a bona fide professional 
 association of agents, not acting on behalf of an insurer, from 
 offering courses.  The course of study shall consist of 30 hours 
 of classroom study devoted to the basic fundamentals of 
 insurance for those seeking a Minnesota license for the first 
 time, 15 hours devoted to specific life and health topics for 
 those seeking a life and health license, and 15 hours devoted to 
 specific property and casualty topics for those seeking a 
 property and casualty license.  Of the 30 hours of required 
 classroom study, at least three hours must be devoted to state 
 insurance laws, regulations, and rules.  The program of studies 
 or study course shall have been approved by the commissioner in 
 order to qualify under this paragraph.  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 the organization offering the course shall 
 accompany the applicant'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. 

    (e) 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.  Examination results are valid for a period of three 
 years from the date of the examination.  

    (f) An applicant who has failed to pass an examination may 
 take subsequent examinations.  Examination fees for subsequent 
 examinations shall not be waived. 

    (g) 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.  An applicant whose license is not renewed under 
 section 60K.12 is exempt from the requirement of a written 
 examination.  

    Subd. 3.    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: 

    (a) 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. 

    (b) The commissioner shall not issue a license to a 
 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 an 
 action, suit, or proceeding instituted by or on behalf of an 
 interested person arising out of the applicant's insurance 
 business in this state.  This designation constitutes 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 a licensee in an action or 
 proceeding begun in a court of competent jurisdiction of this 
 state may be made in compliance with section 45.028, subdivision 
 2.  

    (c) A nonresident agent shall be held to the same knowledge 
 of state insurance law, regulations, and rules as that required 
 of a resident agent according to subdivision 2, paragraph (d). 

    (d) A nonresident license terminates 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.  

    Subd. 4.    Term.  All licenses issued pursuant to this 
 section remain in force until voluntarily terminated by the 
 licensee, not renewed as prescribed in section 60K.06, or until 
 suspended or revoked by the commissioner.  A voluntary 
 termination occurs 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 also occurs upon the happening of the 
 event described in subdivision 3, paragraph (c).  

    Every licensed agent shall notify the commissioner within 
 ten days of a change of name, address, or information contained 
 in the application. 

    Subd. 5.    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 (6).  The 
 notice of appointment must be on a form prescribed by the 
 commissioner.  

    Subd. 6.    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 
 check payable to the state treasurer for the amount of fee 
 specified in section 60K.06, subdivision 2, paragraph (a).  

    An applicant who surrenders an insurance license pursuant 
 to this subdivision retains licensed status until an amended 
 license is received.  

    Subd. 7.    Exceptions.  The following are exempt from 
 the general licensing requirements prescribed by this section:  

    (1) agents of township mutuals who are exempted pursuant to 
 section 60K.04; 

    (2) fraternal benefit society representatives exempted 
 pursuant to section 60K.05; 

    (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 the 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 for insurance; 

    (5) employees of a creditor who enroll debtors for credit 
 life, credit accident and health, or credit involuntary 
 unemployment insurance; provided the employees receive no 
 commission or fee for it; 

    (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; 

    (7) rental vehicle companies and their employees in 
 connection with the offer of insurance authorized under section 
 72A.125; 

    (8) employees of a retailer who enroll purchasers for 
 credit insurance associated with a retail purchase; provided the 
 employees receive no commission, fee, bonus, or other form of 
 compensation for it; and 

    (9) representatives of prepaid legal service plans in 
 connection with the sale and marketing of these plans. 

    HIST: 1992 c 564 art 3 s 5; 1993 c 343 s 6; 1994 c 632 art 4 s 
 27-29; 1995 c 258 s 13; 1996 c 446 art 1 s 8; 1999 c 177 s 
 30,31; 1999 c 236 s 1; 2000 c 483 s 6 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.04 Township mutual agents. 

    No agent for a township mutual shall be required to take an 
 examination to become eligible for an agent's license in farm 
 property perils and farm liability if it is certified by one or 
 more township mutual companies that the agent has been acting in 
 the capacity of an agent at least since January 1, 1971, and no 
 new examination shall be required for eligibility for a license 
 in farm property perils and farm liability for a licensed agent 
 in farm windstorm and hail insurance who was licensed prior to 
 January 1, 1971.  

    HIST: 1992 c 564 art 3 s 6 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.05 Fraternal benefit society representatives. 

    Representatives of fraternal benefit societies who solicit 
 and negotiate insurance contracts shall be deemed to be 
 insurance agents and subject to the licensing requirements as 
 set forth in section 60K.03, subdivision 1; provided, that no 
 insurance agent's license shall be required of:  

    (1) any officer, employee, or secretary of a fraternal 
 benefit society or of any subordinate lodge or branch who 
 devotes substantially all of that person's time to activities 
 other than the solicitation or negotiation of insurance 
 contracts and who receives no commission or other compensation 
 directly dependent upon the number or amount of contracts 
 solicited or negotiated; or 

    (2) any agent or representative of a fraternal benefit 
 society who devotes, or intends to devote, less than 50 percent 
 of that person's time to the solicitation and procurement of 
 insurance contracts for that society.  Any person who in the 
 preceding calendar year has solicited and procured life 
 insurance in excess of $50,000 face amount, or, in the case of 
 any other kinds of insurance which the society may write, on the 
 persons of more than 25 individuals, and who has received or 
 will receive a commission or other compensation in the total 
 amount of $1,000 or more, shall be presumed to be devoting, or 
 intending to devote, 50 percent of that person's time to the 
 solicitation or procurement of insurance contracts for that 
 society.  

    HIST: 1992 c 564 art 3 s 7 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.06 Fees. 

    Subdivision 1.    Renewal fees.  (a) Each agent licensed 
 pursuant to section 60K.03 shall pay in accordance with the 
 procedure adopted by the commissioner a renewal fee as 
 prescribed by subdivision 2.  

    (b) Every agent, corporation, limited liability company, 
 and partnership renewal license is valid for a period of 24 
 months.  The commissioner may stagger the implementation of the 
 24-month licensing program so that approximately one-half of the 
 licenses will expire on October 31 of each even-numbered year 
 and the other half on October 31 of each odd-numbered year. 
 Those licensees who will receive a 12-month license on November 
 1, 1994, because of the staggered implementation schedule, will 
 pay for the license a fee reduced by an amount equal to one-half 
 the fee for renewal of the license. 

    (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 November 1.  Applications for renewal of a license are 
 timely filed if received by the commissioner on or before 
 October 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 October 15.  

    Subd. 2.    Licensing fees.  (a) In addition to the fees 
 and charges provided for examinations, each agent licensed 
 pursuant to section 60K.03 shall pay to the commissioner: 

    (1) a fee of $80 per license for an initial license issued 
 to an individual agent, and a fee of $80 for each renewal; 

    (2) a fee of $200 for an initial license issued to a 
 partnership, limited liability company, or corporation, and a 
 fee of $150 for each renewal; 

    (3) a fee of $75 for an initial amendment (variable 
 annuity) to a license, and a fee of $50 for each renewal; and 

    (4) a fee of $500 for an initial surplus lines agent's 
 license, and a fee of $500 for each renewal. 

    (b) 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 November 1 of the renewal year.  Applications for renewal 
 of a license are timely filed if received by the commissioner on 
 or before the 15th day preceding the license renewal date of the 
 applicant 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 on or before the 15th day preceding the licensing 
 renewal date of the applicant. 

    (c) Initial licenses issued under this section must be 
 valid for a period not to exceed two years.  The commissioner 
 shall assign an expiration date to each initial license so that 
 approximately one-half of all licenses expire each year.  Each 
 initial license must expire on October 31 of the expiration year 
 assigned by the commissioner. 

    (d) All fees shall be retained by the commissioner and are 
 nonreturnable, except that an overpayment of any fee must be 
 refunded upon proper application. 

    Subd. 3.    Initial license expiration; fee reduction.  
 If an initial license issued under subdivision 2, paragraph (a), 
 expires less than 12 months after issuance, the license fee must 
 be reduced by an amount equal to one-half the fee for a renewal 
 of the license. 

    HIST: 1992 c 564 art 3 s 8; 1994 c 632 art 4 s 30; 1997 c 200 
 art 1 s 43; 1999 c 223 art 2 s 7 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.07 Temporary licenses. 

    Subdivision 1. Repealed, 1997 c 222 s 60 

    Subd. 2.    Permissive temporary license.  The 
 commissioner may issue a temporary license to a person to act as 
 an insurance agent for a period not to exceed 90 days, which may 
 be extended as determined by the commissioner, without requiring 
 an examination if the commissioner considers a temporary license 
 necessary for the servicing of an insurance business in the 
 following cases:  

    (1) to an agent licensed as a resident agent in another 
 state where the commissioner determines that the foreign license 
 is substantially the equivalent of that being applied for from 
 the state of Minnesota and where the agent has been transferred 
 into this state with the intention of becoming a resident, 
 working as an insurance agent, and obtaining a resident license 
 from the state of Minnesota; 

    (2) to the surviving spouse or next of kin, or to the 
 administrator or executor, or to an employee of a deceased 
 licensed insurance agent, or to the spouse, next of kin, an 
 employee, or legal guardian of a disabled licensed insurance 
 agent; 

    (3) to the designee of a licensed insurance agent entering 
 upon active service in the armed forces of the United States; or 

    (4) in any other circumstance where the commissioner 
 considers that the public interest will best be served by the 
 issuance of a temporary license.  

    HIST: 1992 c 564 art 3 s 9 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

  60K.08 Repealed, 1999 c 177 s 88 

     60K.081 Brokerage business. 

    Every insurance agent licensed to transact business in this 
 state may procure the insurance of risks, or parts of risks, in 
 the class or classes of insurance for which the agent is 
 licensed, from an insurer authorized to transact business in 
 this state, when the agent is not an appointed agent of the 
 insurer, but the insurance must be consummated only through an 
 appointed agent of the insurer. 

    HIST: 2000 c 483 s 7 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.09 Unfit person not to be employed by insurer. 

    No insurer, its officers, agents, or managers shall 
 knowingly make application to the commissioner for appointment 
 of a person as its agent where that person is known to the 
 insurer, its officers, agents, or managers making the 
 application, to be unfit or disqualified to be licensed as an 
 insurance agent, and immediately upon the discovery by the 
 insurer, its officers, agents, or managers having supervision of 
 the agent, of the unfitness or disqualification, the insurer, or 
 the officers agents, or managers shall forthwith inform the 
 commissioner in writing of their decision to terminate their 
 appointment of this agent; nor shall any insurer retain in its 
 employ any agent known by it to be disqualified or unfit to be 
 licensed as an insurance agent. 

    HIST: 1992 c 564 art 3 s 11 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.10 Term of appointments. 

    All appointments of agents by insurers pursuant to this 
 section shall remain in force until terminated voluntarily by 
 the appointing insurer or the license of the agent has for any 
 reason been terminated during the appointment.  The original 
 appointing insurer, as well as any subsequent appointing 
 insurer, may terminate the 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 (1) the insurer 
 or any of its officers, employees, or representatives submitting 
 or providing the document, record, or statement, or (2) any 
 person, firm, or corporation furnishing in good faith to the 
 insurer the information upon which the reasons for termination 
 are based.  

    HIST: 1992 c 564 art 3 s 12 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.11 Denial, revocation, suspension, and censure of 
  licenses. 

    Subdivision 1.    Grounds.  The commissioner may by 
 order take any or all of the following actions: 

    (1) deny, suspend, or revoke an insurance agent or agency 
 license; 

    (2) censure the licensee; or 

    (3) impose a civil penalty as provided for in section 
 45.027, subdivision 6. 

    In order to take this action the commissioner must find 
 that the order is in the public interest and that the applicant; 
 licensee; or in the case of an insurance agency, partner, 
 director, shareholder, officer, or agent of that insurance 
 agency: 

    (i) does not intend to or is not in good faith carrying on 
 the business of an insurance agent; 

    (ii) has filed an application for a license which is 
 incomplete in any material respect or contains any statement 
 which, in light of the circumstances under which it is made, 
 contains any misrepresentation, or is false, misleading, or 
 fraudulent; 

    (iii) has engaged in an act or practice, whether or not 
 such act or practice involves the business of insurance, which 
 demonstrates that the applicant or licensee is untrustworthy, 
 financially irresponsible, or otherwise incompetent or 
 unqualified to act as an insurance agent or agency; 

    (iv) has pled guilty, with or without explicitly admitting 
 guilt, pled nolo contendere, or been convicted of a felony, 
 gross misdemeanor, or misdemeanor involving moral turpitude, 
 including, but not limited to, assault or similar conduct; 

    (v) has violated or failed to comply with any of the 
 provisions of the insurance laws including chapter 45 or 
 chapters 60A to 72A or any rule or order under those chapters; 

    (vi) is permanently or temporarily enjoined by any court of 
 competent jurisdiction from engaging in or continuing any 
 conduct or practice involving any aspect of the insurance 
 business; 

    (vii) has violated or failed to comply with any order of 
 the insurance regulator of any other state or jurisdiction; 

    (viii) has had an insurance agent or agency license denied, 
 suspended, or revoked, has been censured or reprimanded, has 
 been the subject of any other discipline imposed by, or has paid 
 or has been required to pay a monetary penalty or fine to, 
 another state or jurisdiction; 

    (ix) has misrepresented the terms of any actual or proposed 
 insurance contract; 

    (x) has engaged in any fraudulent, coercive, deceptive, or 
 dishonest act or practice whether or not such act or practice 
 involves the business of insurance; 

    (xi) has improperly withheld, misappropriated, or converted 
 to the licensee's or applicant's own use any money belonging to 
 a policyholder, insurer, beneficiary, or other person; 

    (xii) has forged another's name to any document whether or 
 not the document relates to an application for insurance or a 
 policy of insurance; or 

    (xiii) has, while performing residential mortgage activity 
 regulated under chapter 58, violated any notification, 
 disclosure, or recordkeeping requirement, or any standard of 
 conduct, imposed by chapter 58.  

    Subd. 2.    Licensees.  If the commissioner determines 
 that one of the conditions listed in subdivision 1 exists, the 
 commissioner may issue an order requiring a licensee to show 
 cause why any or all of the following should not occur:  (1) the 
 license revocation or suspension; (2) censuring of the licensee; 
 or (3) the imposition of a civil penalty.  The order shall be 
 calculated to give reasonable notice of the time and place for 
 hearing on the matter, and shall state the reasons for the entry 
 of the order.  The commissioner may by order summarily suspend a 
 license pending final determination of any order to show cause.  
 If a license is suspended pending final determination of an 
 order to show cause, a hearing on the merits shall be held 
 within 30 days of the issuance of the order of suspension.  All 
 hearings shall be conducted in accordance with the provisions of 
 chapter 14.  After the hearing, the commissioner shall enter an 
 order disposing of the matter as the facts require.  If the 
 licensee fails to appear at a hearing after having been duly 
 notified of it, the licensee shall be considered in default, and 
 the proceeding may be determined against the licensee upon 
 consideration of the order to show cause, the allegations of 
 which may be considered to be true. 

    Subd. 3.    Applicants.  Whenever it appears to the 
 commissioner that a license application should be denied 
 pursuant to subdivision 1, the commissioner shall promptly give 
 a written notice to the applicant of the denial.  The notice 
 must state the grounds for the denial and give reasonable notice 
 of the rights of the applicant to request a hearing.  A hearing 
 must be held not later than 30 days after the request for the 
 hearing is received by the commissioner unless the applicant and 
 the department of commerce agree that the hearing may be held at 
 a later date.  If no hearing is requested within 30 days of 
 service of the notice, the denial will become final.  All 
 hearings shall be conducted in accordance with the provisions of 
 chapter 14.  After the hearing, the commissioner shall enter an 
 order making such disposition as the facts require.  If the 
 applicant fails to appear at a hearing after having been duly 
 notified of it, the person shall be considered in default, and 
 the proceeding may be determined against the applicant upon 
 consideration of the notice denying application, the allegations 
 of which may be considered to be true.  All fees accompanying 
 the application and appointment are considered earned and are 
 not refundable. 

    Subd. 4.    Actions against lapsed license.  If a 
 license lapses, is surrendered, withdrawn, terminated, or 
 otherwise becomes ineffective, the commissioner may institute a 
 proceeding under this subdivision within two years after the 
 license was last effective and enter a revocation or suspension 
 order as of the last date on which the license was in effect, or 
 impose a civil penalty as provided for in section 45.027, 
 subdivision 6. 

    Subd. 5.    Notification of action taken by other state. 
  An insurance agent shall notify the commissioner within 30 
 days of any fine imposed on that agent by another state or of a 
 suspension or revocation of license by the commissioner of 
 commerce of this state or the commissioner of insurance of any 
 other state.  

    Subd. 6.    Conditions for relicensure.  A revocation of 
 a license shall prohibit the licensee from making a new 
 application for a license for at least two years from the 
 effective date of the revocation.  Further, the commissioner 
 shall, as a condition of reapplication, require the applicant to 
 obtain a performance bond issued by an insurer authorized to 
 transact business in this state in the amount of $20,000 or a 
 greater amount the commissioner considers appropriate for the 
 protection of citizens of this state in the event the 
 commissioner grants the application.  The bond shall be filed 
 with the commissioner, with the state of Minnesota as obligee, 
 conditioned for the prompt payment to any aggrieved person 
 entitled to payment of any amounts received by the licensee or 
 to protect any aggrieved person from loss resulting from 
 fraudulent, deceptive, dishonest, or other prohibited practices 
 arising out of any transaction when the licensee was licensed or 
 performed acts for which a license is required under this 
 chapter.  The bond shall remain operative for as long as that 
 licensee is licensed.  The bond required by this subdivision 
 must provide coverage for all matters arising during the period 
 of licensure. 

    HIST: 1992 c 564 art 3 s 13; 1999 c 151 s 38 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.12 Tax clearance certificate. 

    Subdivision 1.    Requirement for issuance or renewal of 
 license.  In addition to the provisions of section 60K.11, the 
 commissioner may not issue or renew a license if the 
 commissioner of revenue notifies the commissioner and the 
 licensee or applicant for a license that the licensee or 
 applicant owes the state delinquent taxes in the amount of $500 
 or more.  The commissioner may issue or renew the license only 
 if:  (1) the commissioner of revenue issues a tax clearance 
 certificate; and (2) the commissioner of revenue or the licensee 
 or applicant forwards a copy of the clearance certificate to the 
 commissioner.  The commissioner of revenue may issue a clearance 
 certificate only if the licensee or applicant does not owe the 
 state any uncontested delinquent taxes. 

    Subd. 2.    Definitions.  For purposes of this section, 
 the following terms have the meanings given them:  

    (1) "taxes" are all taxes payable to the commissioner of 
 revenue, including penalties and interest due on those taxes; 
 and 

    (2) "delinquent taxes" do not include a tax liability if 
 (i) an administrative or court action that contests the amount 
 or validity of the liability has been filed or served, (ii) the 
 appeal period to contest the tax liability has not expired, or 
 (iii) the licensee or applicant has entered into a payment 
 agreement to pay the liability and is current with the payments. 

    Subd. 3.    Contested case hearing.  In lieu of the 
 notice and hearing requirements of section 60K.11, when a 
 licensee or applicant is required to obtain a clearance 
 certificate under this section, a contested case hearing must be 
 held if the licensee or applicant requests a hearing in writing 
 to the commissioner of revenue within 30 days of the date of the 
 notice provided in subdivision 1.  The hearing must be held 
 within 45 days of the date the commissioner of revenue refers 
 the case to the office of administrative hearings.  
 Notwithstanding any law to the contrary, the licensee or 
 applicant must be served with 20 days' notice in writing 
 specifying the time and place of the hearing and the allegations 
 against the licensee or applicant.  The notice may be served 
 personally or by mail. 

    Subd. 4.    Identification required.  The commissioner 
 shall require all licensees or applicants to provide their 
 social security number and Minnesota business identification 
 number on all license applications.  Upon request of the 
 commissioner of revenue, the commissioner must provide to the 
 commissioner of revenue a list of all licensees and applicants, 
 including the name and address, social security number, and 
 business identification number.  The commissioner of revenue may 
 request a list of the licensees and applicants no more than once 
 each calendar year. 

    HIST: 1992 c 564 art 3 s 14 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.13 Surrender, loss, or destruction of license. 

    Subdivision 1.    Notification.  The commissioner shall 
 promptly notify the licensee and all appointing insurers, where 
 applicable, of any suspension, revocation, or termination of the 
 licensee's agent's license by the commissioner.  Upon receipt of 
 the notice of suspension or revocation of a license, the 
 licensee shall immediately deliver it to the commissioner.  

    Subd. 2.    Return of license.  An agent whose resident 
 or nonresident license is terminated, as provided in section 
 60K.11, shall deliver the terminated license to the commissioner 
 by personal delivery or by mail within 30 days after the date of 
 termination.  

    Subd. 3.    Duplicate license.  The commissioner may 
 issue a duplicate license for any lost, stolen, or destroyed 
 license issued pursuant to this section upon an affidavit of the 
 licensee concerning the facts of the loss, theft, or 
 destruction, and the payment of a fee of $3 by money order or 
 cashier's check payable to the state treasurer.  

    HIST: 1992 c 564 art 3 s 15 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.14 Prohibited acts; required acts. 

    Subdivision 1.    Personal solicitation of insurance 
 sales.  (a)    Definitions.  For the purposes of this 
 section, the following terms have the meanings given them:  

    (1) "agent" means a person, copartnership, or corporation 
 required to be licensed pursuant to section 60K.02; and 

    (2) "personal solicitation" means any contact by an agent, 
 or any person acting on behalf of an agent, made for the purpose 
 of selling or attempting to sell insurance, when either the 
 agent or a person acting for the agent contacts the buyer by 
 telephone or in person, except:  (i) an attempted sale in which 
 the buyer personally knows the identity of the agent, the name 
 of the general agency, if any, which the agent represents, and 
 the fact that the agent is an insurance agent; (ii) an attempted 
 sale in which the prospective purchaser of insurance initiated 
 the contact; or (iii) a personal contact which takes place at 
 the agent's place of business.  

    (b)    Disclosure requirement.  Before a personal 
 solicitation, the agent or person acting for an agent shall, at 
 the time of initial personal contact with the potential buyer, 
 clearly and expressly disclose in writing:  

    (1) the name of the person making the contact; 

    (2) the name of the agent, general agency, or insurer that 
 person represents; and 

    (3) the fact that the agent, agency, or insurer is in the 
 business of selling insurance.  

    If the initial personal contact is made by telephone, the 
 disclosures required by this subdivision need not be made in 
 writing. 

    (c)    False representation of government affiliation.  
 No agent or person acting for an agent shall make any 
 communication to a potential buyer that indicates or gives the 
 impression that the agent is acting on behalf of a government 
 agency. 

    Subd. 2.    Fees for services.  No person shall charge a 
 fee for any services rendered in connection with the 
 solicitation, negotiation, or servicing of any insurance 
 contract unless: 

    (1) before rendering the services, a written statement is 
 provided disclosing: 

    (i) the services for which fees are charged; 

    (ii) the amount of the fees; 

    (iii) that the fees are charged in addition to premiums; 
 and 

    (iv) that premiums include a commission; and 

    (2) all fees charged are reasonable in relation to the 
 services rendered. 

    Subd. 3.    Commissions or compensation.  No commission 
 or other compensation shall be paid or allowed by any person, 
 firm, or corporation to any other person, firm, or corporation 
 acting, or assuming to act, as an insurance agent without a 
 license therefor.  A duly licensed agent may pay commissions or 
 assign or direct that commissions be paid to a partnership of 
 which the agent is a member, employee, or agent, or to a 
 corporation of which the agent is an officer, employee, or 
 agent.  This subdivision does not prevent the payment or receipt 
 of renewal or other deferred commissions to or by any person 
 solely because the person has ceased to hold a license to act as 
 an insurance agent. 

    Subd. 4.    Suitability of insurance.  In recommending 
 the purchase of any life, endowment, individual accident and 
 sickness, long-term care, annuity, life-endowment, or Medicare 
 supplement insurance to a customer, an agent must have 
 reasonable grounds for believing that the recommendation is 
 suitable for the customer and must make reasonable inquiries to 
 determine suitability.  The suitability of a recommended 
 purchase of insurance will be determined by reference to the 
 totality of the particular customer's circumstances, including, 
 but not limited to, the customer's income, the customer's need 
 for insurance, and the values, benefits, and costs of the 
 customer's existing insurance program, if any, when compared to 
 the values, benefits, and costs of the recommended policy or 
 policies. 

    Subd. 5.    Premiums.  All premiums or other money 
 received by an agent from an insured or applicant for insurance 
 must be forthwith deposited directly in a business checking, 
 savings, or other similar account maintained by the agent or 
 agency, unless the money is forwarded directly to the designated 
 insurer. 

    Subd. 6.    Privacy of client.  Except as otherwise 
 provided by law, no insurance agent may disclose nor cause to be 
 disclosed to any other person the identity of a person insured 
 through the agent without the consent of the insured.  

    Subd. 7.    Disclosure of commissions.  Before selling 
 any health plan as defined in section 62A.011, subdivision 3, an 
 agent shall disclose in writing to the prospective purchaser the 
 amount of any commission or other compensation the agent will 
 receive as a direct result of the sale.  The disclosure may be 
 expressed in dollars or as a percentage of the premium.  The 
 amount disclosed need not include any anticipated renewal 
 commissions. 

    HIST: 1992 c 564 art 3 s 16; 1993 c 345 art 5 s 3; 1994 c 485 
 s 15; 1994 c 625 art 10 s 2; 1995 c 258 s 14; 2000 c 483 s 8 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.15 Insurer's agent. 

    Any person who solicits insurance is the agent of the 
 insurer and not the agent of the insured. 

    HIST: 1992 c 564 art 3 s 17 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.16 Liability for placing insurance in unauthorized 
  company. 

    Any person, regardless of whether that person is required 
 to be licensed as an insurance agent, who participates in any 
 manner in the sale of any insurance policy or certificate, or 
 any other contract providing benefits, for or on behalf of any 
 company which is required to be, but which is not authorized to 
 engage in the business of insurance in this state, other than 
 pursuant to sections 60A.195 to 60A.209, shall be personally 
 liable for all premiums, whether earned or unearned, paid by the 
 insured, and the premiums may be recovered by the insured.  In 
 addition, that person shall be personally liable for any loss 
 the insured has sustained or may sustain if the loss is one 
 resulting from a risk or hazard covered in the issued policy, 
 certificate, or contract or which would have been covered if the 
 policy, certificate, or contract had been issued to the 
 purchaser of the insurance. 

    HIST: 1992 c 564 art 3 s 18 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.17 Agents; variable contracts. 

    Subdivision 1.    License required.  No person shall 
 sell or offer for sale a contract on a variable basis unless 
 prior to making any solicitation or sale the person has obtained 
 from the commissioner a license therefor.  The license shall 
 only be granted, upon the written requisition of an insurer, to 
 a qualified person who holds a current license authorizing the 
 person to solicit and sell life insurance and annuity contracts 
 in this state.  To become qualified, a person shall complete a 
 written application on a form prescribed by the commissioner and 
 shall take and pass an examination prescribed by the 
 commissioner.  

    Subd. 2.    Exceptions.  (a) Any regularly salaried 
 officer or employee of a licensed insurer may, without license 
 or other qualification, act on behalf of that licensed insurer 
 in the negotiation of a contract on a variable basis, provided 
 that a licensed agent must participate in the sale of any 
 contract. 

    (b) Any person who holds a valid license to solicit and 
 sell life insurance and annuity contracts may solicit and sell 
 contracts on a variable basis without acquiring a license under 
 this subdivision if the contract is based on an account which is 
 excluded from the definition of investment company under the 
 Investment Company Act of 1940, United States Code, title 15, 
 section 80a-3(11). 

    Subd. 3.    Rules.  The commissioner may by rule waive 
 or modify any of the requirements in this section or prescribe 
 additional requirements considered necessary for the proper sale 
 and solicitation of contracts on a variable basis. 

    HIST: 1992 c 564 art 3 s 19 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.18 Altering existing policies; written binders 
  required. 

    An insurance agent having express authority to bind 
 coverage, who orally agrees on behalf of an insurer to provide 
 insurance coverage, or to alter an existing insurance agreement, 
 shall execute and deliver a written memorandum or binder 
 containing the terms of the oral agreement to the insured within 
 three business days from the time the oral agreement is entered. 

    HIST: 1992 c 564 art 3 s 20 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.19 Continuing insurance education. 

    Subdivision 1.    Definition.  For the purposes of this 
 section, "course" means a course, program of instruction, or 
 seminar of continuing insurance education.  A "professional 
 designation examination" means a written, proctored, and graded 
 examination the passage of which leads to a bona fide insurance 
 or financial planning professional designation used by agents.  

    Subd. 2.    Applicability.  This section applies to all 
 natural persons licensed by this state to sell classes of 
 insurance for which licensing examinations are required.  

    Subd. 3.    Exemptions.  This section does not apply to: 

    (a) persons soliciting or selling solely on behalf of 
 companies organized and operating according to chapter 67A; or 

    (b) persons holding life and health, or property and 
 casualty licenses who, at the time of license renewal, certify 
 to the commissioner in writing that they will sell only credit 
 life, credit accident and health, credit involuntary 
 unemployment, and credit property insurance, during that year 
 and do in fact so limit their sale of insurance.  

    Subd. 4. Repealed, 2001 c 161 s 58 

    Subd. 5.    Powers of the advisory task force.  (a) 
 Applications for approval of individuals responsible for 
 monitoring course offerings must be submitted to the 
 commissioner on forms prescribed by the commissioner and must be 
 accompanied by a fee of not more than $100 payable to the state 
 of Minnesota for deposit in the general fund.  A fee of $10 for 
 each hour or fraction of one hour of course approval sought must 
 be forwarded with the application for course approval.  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.  

    (c) The advisory task force shall recommend the approval or 
 disapproval of professional designation examinations that meet 
 the criteria established by this section and the number of 
 continuing education credit hours to be awarded for passage of 
 the examination.  In order to be approved, a professional 
 designation examination must:  

    (1) lead to a recognized insurance or financial planning 
 professional designation used by agents; and 

    (2) conclude with a written examination that is proctored 
 and graded.  

    Subd. 6.    Powers of the commissioner.  (a) The 
 commissioner shall make the final determination as to 
 accreditation and assignment of credit hours for courses.  

    (b) The commissioner shall adopt procedures for reporting 
 compliance with the minimum education requirement.  

    (c) The commissioner shall promulgate rules according to 
 chapter 14 to carry out the purposes of this section.  

    Subd. 7.    Criteria for course accreditation.  (a) The 
 commissioner may accredit a course only to the extent it is 
 designed to impart substantive and procedural knowledge of the 
 insurance field.  The burden of demonstrating that the course 
 satisfies this requirement is on the individual or organization 
 seeking accreditation.  The commissioner shall approve any 
 educational program approved by Minnesota Continuing Legal 
 Education relating to the insurance field.  The commissioner is 
 authorized to establish a procedure for renewal of course 
 accreditation. 

    (b) The commissioner shall approve or disapprove 
 professional designation examinations that are recommended for 
 approval by the advisory task force.  In order for an agent to 
 receive full continuing education credit for a professional 
 designation examination, the agent must pass the examination.  
 An agent may not receive credit for classroom instruction 
 preparing for the professional designation examination and also 
 receive continuing education credit for passing the professional 
 designation examination. 

    (c) The commissioner may not accredit a course:  

    (1) that is designed to prepare students for a license 
 examination; 

    (2) in mechanical office or business skills, including 
 typing, speedreading, use of calculators, or other machines or 
 equipment; 

    (3) in sales promotion, including meetings held in 
 conjunction with the general business of the licensed agent; or 

    (4) in motivation, the art of selling, psychology, or time 
 management. 

    Subd. 8.    Minimum education requirement.  Each person 
 subject to this section shall complete a minimum of 30 credit 
 hours of courses accredited by the commissioner during each 
 24-month licensing period.  Any person whose initial licensing 
 period extends more than six months shall complete 15 hours of 
 courses accredited by the commissioner during the initial 
 license period.  Any person teaching or lecturing at an 
 accredited course qualifies for three times the number of credit 
 hours that would be granted to a person completing the 
 accredited course.  No more than one-half of the credit hours 
 per licensing period required under this section may be credited 
 to a person for attending any combination of courses either:  
 (1) sponsored by, offered by, or affiliated with an insurance 
 company or its agents; or (2) offered using new delivery 
 technology, including computer, interactive technology, and the 
 Internet.  Courses sponsored by, offered by, or affiliated with 
 an insurance company or agent may restrict its students to 
 agents of the company or agency. 

    Subd. 9.    Waiver of requirements.  (a) The 
 commissioner may grant a waiver or an extension of time up to 90 
 days to complete the minimum education requirement to an 
 individual upon a showing of good cause.  It is the licensed 
 person's responsibility to request a waiver or extension on a 
 form prescribed by the commissioner.  As of the day the licensed 
 person properly files a request for a waiver or extension, the 
 license remains in effect until the commissioner notifies the 
 licensed person of the commissioner's decision.  The 
 commissioner may approve a waiver or extension subject to any 
 reasonable conditions.  The person's license remains in effect 
 during the compliance period determined by the commissioner.  If 
 the licensed person fails to comply with any reasonable 
 conditions imposed by the commissioner, the commissioner shall 
 terminate the license.  If the request for a waiver or extension 
 is denied by the commissioner, the licensed person shall have 30 
 days within which to satisfy the minimum education requirement 
 involved in the request for a waiver or extension.  If the 
 minimum education requirement is not satisfied within the 
 compliance period, the commissioner shall terminate the person's 
 license.  

    (b) Upon application on a form prescribed by the 
 commissioner, the commissioner may grant a waiver of the minimum 
 education requirement to a licensee who is no longer actively 
 engaged in the solicitation and sale of insurance.  A licensed 
 person seeking a waiver from the requirements of this section 
 may be required to submit information to the commissioner that 
 substantiates the person's retirement or inactive status.  A 
 licensed person receiving a waiver from the commissioner may 
 maintain and renew a license but may not solicit or sell new 
 insurance business while this waiver is in effect.  A licensee 
 may, for a fee, continue to service an insurance policy for 
 which the licensee is the agent of record, if the policy is in 
 force at the time the waiver is granted.  An insurer may not 
 terminate a service contract or refuse to pay compensation 
 because the waiver does not allow the licensee to solicit or 
 sell new insurance.  

    For the purposes of receiving renewal commissions and other 
 benefits or compensation from insurers, an agent receiving a 
 waiver under this paragraph is considered to be the holder of a 
 valid insurance agent license in this state.  

    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 in 
 accordance with the procedures adopted by the commissioner.  The 
 compliance report must not claim credit for continuing education 
 not actually completed at the date of filing the report. 

    (b) An institution offering an accredited course shall 
 comply with the procedure for reporting compliance adopted by 
 the commissioner.  

    (c) If a person subject to this section completes a 
 nonaccredited course, that person 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.  

    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.  

    HIST: 1983 c 289 s 114 subd 1; 1983 c 328 s 6; 1984 c 552 s 3; 
 1984 c 578 s 2; 1984 c 592 s 34-36; 1984 c 655 art 1 s 92; 
 1Sp1985 c 10 s 53,54; 1986 c 444; 1987 c 337 s 8-10; 1989 c 231 
 s 1-5; 1992 c 513 art 3 s 25; 1992 c 564 art 1 s 19,20; 1993 c 
 343 s 7; 1994 c 632 art 4 s 31; 1996 c 439 art 1 s 7-9; 1997 c 
 187 art 3 s 14; 1999 c 177 s 32,33; 2000 c 483 s 9; 2001 c 141 s 
 1; 2001 c 208 s 5 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, 
*article 1, section 28, effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.20 Social security numbers of licensed agents; 
  commissioner's authority to provide to NAIC. 

    The commissioner may provide the social security numbers of 
 licensed insurance agents to the National Association of 
 Insurance Commissioners. 

    HIST: 1997 c 222 s 7 

*   NOTE:  This section is repealed by Laws 2001, chapter 117, article 
*1, section 28, effective July 1, 2002.  Laws 2001, chapter 117, article 
*1, section 29.

     60K.30 Purpose and scope. 

    (a) Sections 60K.30 to 60K.56 govern the qualifications and 
 procedures for the licensing of insurance producers.  

    (b) Except as to the underlying requirement that a surplus 
 lines agent or broker obtain an insurance producer license, this 
 chapter does not apply to surplus lines agents or brokers 
 licensed under sections 60A.195 to 60A.209, except as provided 
 in sections 60K.39 and 60K.53, subdivision 2. 

    HIST: 2001 c 117 art 1 s 1 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 1, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.31 Definitions. 

    Subdivision 1.    Scope.  For purposes of sections 
 60K.31 to 60K.57, the terms in subdivisions 2 to 18 have the 
 meanings given them.  The definitions in section 60A.02 are 
 applicable to terms not defined in this section, unless the 
 language or context clearly indicates that a different meaning 
 is intended.  

    Subd. 2.    Business entity.  "Business entity" means a 
 corporation, association, partnership, limited liability 
 company, limited liability partnership, or other legal entity. 

    Subd. 3.    Commissioner.  "Commissioner" means the 
 commissioner of commerce. 

    Subd. 4.    Home state.  "Home state" means the District 
 of Columbia and any state or territory of the United States in 
 which an insurance producer maintains the producer's principal 
 place of residence or principal place of business and is 
 licensed to act as an insurance producer. 

    Subd. 5.    Insurance.  "Insurance" means any of the 
 lines of authority in section 60A.06. 

    Subd. 6.    Insurance producer.  "Insurance producer" 
 means a person required to be licensed under the laws of this 
 state to sell, solicit, or negotiate insurance. 

    Subd. 7.    License.  "License" means a document issued 
 by the commissioner authorizing a person to act as an insurance 
 producer for the lines of authority specified in the document.  
 The license itself does not create any authority, actual, 
 apparent, or inherent, in the holder to represent or commit an 
 insurance carrier.  

    Subd. 8.    Limited line credit insurance.  "Limited 
 line credit insurance" includes credit life, credit disability, 
 credit property, credit unemployment, involuntary unemployment, 
 mortgage life, mortgage guaranty, mortgage disability, 
 guaranteed automobile protection insurance, and any other form 
 of insurance offered in connection with an extension of credit 
 that is limited to partially or wholly extinguishing that credit 
 obligation that the commissioner determines should be designated 
 a form of limited line credit insurance. 

    Subd. 9.    Limited line credit insurance producer.  
 "Limited line credit insurance producer" means a person who 
 sells, solicits, or negotiates one or more forms of limited line 
 credit insurance coverage to individuals through a master, 
 corporate, group, or individual policy. 

    Subd. 10.    Limited lines insurance.  "Limited lines 
 insurance" means those lines of insurance defined in section 
 60K.38, subdivision 1, paragraph (c), or any other line of 
 insurance that the commissioner considers necessary to recognize 
 for the purposes of complying with section 60K.39, subdivision 5.

    Subd. 11.    Limited lines producer.  "Limited lines 
 producer" means a person authorized by the commissioner to sell, 
 solicit, or negotiate limited lines insurance. 

    Subd. 12.    Negotiate.  "Negotiate" means the act of 
 conferring directly with or offering advice directly to a 
 purchaser or prospective purchaser of a particular contract of 
 insurance concerning any of the substantive benefits, terms, or 
 conditions of the contract if the person engaged in that act 
 either sells insurance or obtains insurance from insurers for 
 purchasers. 

    Subd. 13.    Person.  "Person" means an individual or a 
 business entity. 

    Subd. 14.    Sell.  "Sell" means to exchange a contract 
 of insurance by any means, for money or its equivalent, on 
 behalf of an insurance company. 

    Subd. 15.    Solicit.  "Solicit" means attempting to 
 sell insurance or asking or urging a person to apply for a 
 particular kind of insurance from a particular company. 

    Subd. 16.    Terminate.  "Terminate" means the 
 cancellation of the relationship between an insurance producer 
 and the insurer or the termination of a producer's authority to 
 transact insurance. 

    Subd. 17.    Uniform Business Entity Application.  
 "Uniform Business Entity Application" means the current version 
 of the Uniform Business Entity Application for resident and 
 nonresident business entities of the National Association of 
 Insurance Commissioners. 

    Subd. 18.    Uniform Application.  "Uniform Application" 
 means the current version of the Uniform Application for 
 resident and nonresident producer licensing of the National 
 Association of Insurance Commissioners. 

    HIST: 2001 c 117 art 1 s 2 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 2, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.32 License required. 

    A person shall not sell, solicit, or negotiate insurance in 
 this state for any class or classes of insurance unless the 
 person is licensed for that line of authority under sections 
 60K.31 to 60K.57.  The license itself does not create any 
 authority, actual, apparent, or inherent, in the holder to 
 represent or commit an insurance carrier. 

    HIST: 2001 c 117 art 1 s 3 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 3, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.33 Criminal penalty. 

    A person who acts or assumes to act as an insurance 
 producer without a license issued under this chapter is guilty 
 of a gross misdemeanor. 

    HIST: 2001 c 117 art 1 s 4 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 4, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.34 Exceptions to licensing. 

    Subdivision 1.    License not required.  Nothing in 
 sections 60K.31 to 60K.57 requires an insurer to obtain an 
 insurance producer license.  In this section, the term "insurer" 
 does not include an insurer's officers, directors, employees, 
 subsidiaries, or affiliates.  

    Subd. 2.    Specific exceptions.  A license as an 
 insurance producer is not required of the following:  

    (1) a fraternal benefit society representative exempted 
 pursuant to section 60K.35; 

    (2) an officer, director, or employee of an insurer or of 
 an insurance producer if the officer, director, or employee does 
 not receive any commission on policies written or sold to insure 
 risks residing, located, or to be performed in this state and: 

    (i) the officer, director, or employee's activities are 
 executive, administrative, managerial, clerical, or a 
 combination of these, and are only indirectly related to the 
 sale, solicitation, or negotiation of insurance; 

    (ii) the officer, director, or employee's function relates 
 to underwriting, loss control, inspection, or the processing, 
 adjusting, investigating, or settling of a claim on a contract 
 of insurance; or 

    (iii) the officer, director, or employee is acting in the 
 capacity of a special agent or agency supervisor assisting 
 insurance producers where the person's activities are limited to 
 providing technical advice and assistance to licensed insurance 
 producers and do not include the sale, solicitation, or 
 negotiation of insurance; 

    (3) a person who secures and furnishes information for the 
 purpose of group life insurance, group property and casualty 
 insurance, group annuities, group or blanket accident and health 
 insurance; or for the purpose of enrolling individuals under 
 plans; issuing certificates under plans or otherwise assisting 
 in administering plans; or performs administrative services 
 related to mass-marketed property and casualty insurance; where 
 no commission is paid to the person for the service; 

    (4) an employer or association or its officers, directors, 
 employees, or the trustees of an employee trust plan, to the 
 extent that the employers, officers, employees, directors, or 
 trustees are engaged in the administration or operation of a 
 program of employee benefits for the employer's or association's 
 own employees or the employees of its subsidiaries or 
 affiliates, which program involves the use of insurance issued 
 by an insurer, as long as the employers, associations, officers, 
 directors, employees, or trustees are not in any manner 
 compensated, directly or indirectly, by the company issuing the 
 contracts; 

    (5) employees of insurers or organizations employed by 
 insurers who are engaging in the inspection, rating or 
 classification of risks, or in the supervision of the training 
 of insurance producers and who are not individually engaged in 
 the sale, solicitation, or negotiation of insurance; 

    (6) a person whose activities in this state are limited to 
 advertising without the intent to solicit insurance in this 
 state through communications in printed publications or other 
 forms of electronic mass media whose distribution is not limited 
 to residents of the state, if the person does not sell, solicit, 
 or negotiate insurance that would insure risks residing, 
 located, or to be performed in this state; 

    (7) a person who is not a resident of this state who sells, 
 solicits, or negotiates a contract of insurance for commercial 
 property and casualty risks to an insured with risks located in 
 more than one state insured under that contract, if the person 
 is otherwise licensed as an insurance producer to sell, solicit, 
 or negotiate that insurance in the state where the insured 
 maintains its principal place of business and the contract of 
 insurance insures risks located in that state; 

    (8) a salaried full-time employee who counsels or advises 
 the employee's employer relative to the insurance interests of 
 the employer or of the subsidiaries or business affiliates of 
 the employer if the employee does not sell or solicit insurance 
 or receive a commission; or 

    (9) rental vehicle companies and their employees in 
 connection with the offer of rental vehicle personal accident 
 insurance under section 72A.125. 

    HIST: 2001 c 117 art 1 s 5 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 5, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.35 Fraternal benefit society representatives. 

    Representatives of fraternal benefit societies who solicit 
 and negotiate insurance contracts are considered to be insurance 
 producers and are subject to the licensing requirements of this 
 chapter, provided that no insurance producer's license is 
 required of: 

    (1) any officer, employee, or secretary of a fraternal 
 benefit society or of any subordinate lodge or branch who 
 devotes substantially all of that person's time to activities 
 other than the solicitation or negotiation of insurance 
 contracts and who receives no commission or other compensation 
 directly dependent upon the number or amount of contracts 
 solicited or negotiated; or 

    (2) any agent or representative of a fraternal benefit 
 society who devotes, or intends to devote, less than 50 percent 
 of that person's time to the solicitation and procurement of 
 insurance contracts for that society.  Any person who in the 
 preceding calendar year has solicited and procured life 
 insurance in excess of $50,000 face amount, or, in the case of 
 any other kinds of insurance that the society may write, on the 
 persons of more than 25 individuals, and who has received or 
 will receive a commission or other compensation in the total 
 amount of $1,000 or more, is presumed to be devoting, or 
 intending to devote, 50 percent of that person's time to the 
 solicitation or procurement of insurance contracts for that 
 society.  

    HIST: 2001 c 117 art 1 s 6 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 6, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.36 Examinations. 

    Subdivision 1.    Requirement.  A resident individual 
 applying for an insurance producer license shall pass a written 
 examination unless exempt under subdivision 2 or section 
 60K.40.  The examination must test the knowledge of the 
 individual concerning the lines of authority for which the 
 application is made, the duties and responsibilities of an 
 insurance producer, and the insurance laws and rules of this 
 state.  Examinations required by this section must be approved 
 by the commissioner. 

    Subd. 2.    Examination not required.  A resident 
 individual applying for a limited lines credit insurance, title 
 insurance, travel baggage insurance, or bail bonds license is 
 not required to take a written examination. 

    Subd. 3.    Administration.  The commissioner may make 
 arrangements, including contracting with an outside testing 
 service, for administering examinations. 

    Subd. 4.    Course of study.  The examination must be 
 given only after the applicant has completed a program of 
 classroom studies in a school, which must not include a school 
 sponsored by, offered by, or affiliated with an insurance 
 company or its producers; except that this limitation does not 
 preclude a bona fide professional association of insurance 
 producers, not acting on behalf of an insurer, from offering 
 courses.  The course of study must consist of 30 hours of 
 classroom study devoted to the basic fundamentals of insurance 
 for those seeking a Minnesota license for the first time and 7.5 
 hours devoted to the line in which the producer seeks to be 
 licensed.  The program of studies or study course must have been 
 approved by the commissioner in order to qualify under this 
 subdivision.  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 must be 
 waived.  A certification of compliance by the organization 
 offering the course must accompany the applicant's license 
 application.  This program of studies in a school or a study 
 course does not apply to limited lines farm property liability 
 applicants or to variable life and variable annuity applicants. 

    Subd. 5.    Failure to appear or pass.  An individual 
 who fails to appear for the examination as scheduled or fails to 
 pass the examination shall reapply for an examination and remit 
 all required fees and forms before being rescheduled for another 
 examination. 

    Subd. 6.    Results; validity.  Examination results are 
 valid for three years from the date of the examination. 

    HIST: 2001 c 117 art 1 s 7 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 7, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.37 Application for license. 

    Subdivision 1.    Resident insurance producer.  A person 
 is 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 constitutes an election of residency in this state.  
 A license issued upon an application claiming residency in this 
 state is void if the licensee, while holding a resident license 
 in this state, obtains a resident license in, or claims to be a 
 resident of, any other state or jurisdiction or if the licensee 
 ceases to be a resident of this state.  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.  

    Subd. 2.    Individuals.  A person applying for a 
 resident insurance producer license shall make application to 
 the commissioner on the Uniform Application and declare under 
 penalty of refusal, suspension, or revocation of the license 
 that the statements made in the application are true, correct, 
 and complete to the best of the individual's knowledge and 
 belief.  Before approving the application, the commissioner 
 shall find that the individual: 

    (1) is at least 18 years of age; 

    (2) has not committed any act that is a ground for denial, 
 suspension, or revocation set forth in section 60K.43; 

    (3) has completed, where required by the commissioner, a 
 prelicensing course of study for the lines of authority for 
 which the person has applied; 

    (4) has paid the fees set forth in section 60K.55; and 

    (5) has successfully passed the examinations for the lines 
 of authority for which the person has applied. 

    Subd. 3.    Businesses.  (a) A business entity acting as 
 an insurance producer is required to obtain an insurance 
 producer license.  Application must be made using the Uniform 
 Business Entity Application.  Before approving the application, 
 the commissioner shall find that: 

    (1) the business entity has paid the fees set forth in 
 section 60K.55; and 

    (2) the business entity has designated an individual 
 licensed producer responsible for the business entity's 
 compliance with the insurance laws and rules of this state. 

    (b) A business entity insurance producer license does not 
 grant authority to any individual officer, director, partner, 
 member, or employee to act as an insurance producer. 

    Subd. 4.    Service of process.  Application for a 
 license under this chapter constitutes appointment of the 
 commissioner as the person's agent for service of process under 
 section 45.028. 

    Subd. 5.    Additional documentation.  The commissioner 
 may require any documents reasonably necessary to verify the 
 information contained in an application. 

    Subd. 6.    Limited line credit insurance instruction.  
 An insurer that sells, solicits, or negotiates any form of 
 limited line credit insurance shall provide to each individual 
 whose duties will include selling, soliciting, or negotiating 
 limited line credit insurance a program of instruction that may 
 be approved by the commissioner. 

    Subd. 7.    Variable life and variable annuity.  A 
 resident individual applying for a variable life and variable 
 annuity license shall demonstrate that the applicant holds a 
 current license as a life insurance producer. 

    HIST: 2001 c 117 art 1 s 8 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 8, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.38 License. 

    Subdivision 1.    Issuance.  (a) Unless denied a license 
 under section 60K.43, a person who has met the requirements of 
 sections 60K.36 and 60K.37 must be issued an insurance producer 
 license.  An insurance producer may receive qualification for a 
 license in one or more of the lines of authority in paragraphs 
 (b) and (c). 

    (b) An individual insurance producer may receive 
 qualification for a license in one or more of the following 
 major lines: 

    (1) life insurance:  coverage on human lives including 
 benefits of endowment and annuities, and may include benefits in 
 the event of death or dismemberment by accident and benefits for 
 disability income; 

    (2) accident and health or sickness insurance:  coverage 
 for sickness, bodily injury, or accidental death, and may 
 include benefits for disability income; 

    (3) property insurance:  coverage for the direct or 
 consequential loss or damage to property of every kind; 

    (4) casualty insurance:  coverage against legal liability, 
 including that for death, injury, or disability, or damage to 
 real or personal property; 

    (5) variable life and variable annuity products insurance:  
 coverage provided under variable life insurance contracts and 
 variable annuities; and 

    (6) personal lines:  property and casualty insurance 
 coverage sold to individuals and families for primarily 
 noncommercial purposes. 

    (c) An individual insurance producer may receive 
 qualification for a license in one or more of the following 
 limited lines: 

    (1) limited line credit insurance; 

    (2) farm property and liability insurance; 

    (3) title insurance; 

    (4) travel baggage insurance; 

    (5) bail bonds; and 

    (6) any other line of insurance permitted under state laws 
 or rules. 

    Subd. 2.    Period of effectiveness.  An insurance 
 producer license remains in effect unless revoked or suspended 
 as long as the fee set forth in section 60K.55 is paid, 
 continuing education requirements for resident individual 
 producers are met, and all additional documentation required by 
 the commissioner is provided by the renewal date. 

    Subd. 3.    Lapsed license.  An individual insurance 
 producer who allows the license to lapse may, within 12 months 
 from the due date of the renewal fee, reinstate the license 
 without the necessity of passing a written examination.  
 However, a penalty in the amount of twice the unpaid renewal fee 
 must be paid by the individual for any renewal fee received 
 after the due date. 

    Subd. 4.    Waivers.  A licensed insurance producer who 
 is unable to comply with license renewal procedures due to 
 military service or some other extenuating circumstance, such as 
 a long-term medical disability, may request a waiver of those 
 procedures.  The producer may also request a waiver of any 
 examination requirement or any other fine or sanction imposed 
 for failure to comply with renewal procedures. 

    Subd. 5.    Contents.  The license must contain the 
 licensee's name, address, producer license number, and the date 
 of issuance, the lines of authority, the expiration date, and 
 any other information the commissioner considers necessary. 

    Subd. 6.    Name or address changes.  Licensees shall 
 inform the commissioner, by any means acceptable to the 
 commissioner, of a change of name or address within ten days of 
 the change.  

    Subd. 7.    Administrative assistance to the commissioner. 
  In order to assist in the performance of the commissioner's 
 duties, the commissioner may contract with nongovernmental 
 entities, including the National Association of Insurance 
 Commissioners (NAIC) or any affiliates or subsidiaries that the 
 NAIC oversees, to perform any ministerial functions, including 
 the collection of fees, related to producer licensing that the 
 commissioner and the nongovernmental entity consider appropriate.

    HIST: 2001 c 117 art 1 s 9 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 9, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.39 Nonresident licensing. 

    Subdivision 1.    Issuance.  Unless denied a license 
 under section 62K.41, a nonresident person shall receive a 
 nonresident producer license if: 

    (1) the person is currently licensed as a resident and in 
 good standing in the person's home state; 

    (2) the person has submitted the proper request for 
 licensure and has paid the fees required by section 60K.55; 

    (3) the person has submitted or transmitted to the 
 commissioner the application for licensure that the person 
 submitted to the person's home state, or in lieu of the same, a 
 completed Uniform Application; and 

    (4) the person's home state awards nonresident producer 
 licenses to residents of this state on the same basis. 

    Subd. 2.    Verification of licensing status.  The 
 commissioner may verify the producer's licensing status through 
 the producer database maintained by the National Association of 
 Insurance Commissioners, its affiliates, or subsidiaries. 

    Subd. 3.    Change of address.  A nonresident producer 
 who moves from one state to another state or a resident producer 
 who moves from this state to another state shall file a change 
 of address and provide certification from the new resident state 
 within ten days of the change of legal residence.  No fee or 
 license application is required. 

    Subd. 4.    Termination; resident license.  A 
 nonresident producer license terminates automatically when the 
 person's resident license is terminated for any reason. 

    Subd. 5.    Surplus lines producers.  (a) 
 Notwithstanding any other provision of sections 60K.31 to 
 60K.57, a person licensed as a surplus lines producer in the 
 person's home state shall receive a nonresident surplus lines 
 producer license under subdivision 1.  Except as to subdivision 
 1, nothing in this section otherwise amends or supersedes any 
 provision of sections 60A.195 to 60A.209. 

    (b) No surplus lines agent or broker licensed under 
 sections 60A.195 to 60A.209 may do business in this state unless 
 the agent or broker has complied with the requirements set forth 
 in section 60A.198, subdivision 3, paragraphs (b) to (d). 

    Subd. 6.    Limited lines producer.  Notwithstanding any 
 other provision of sections 60K.31 to 60K.57, a person licensed 
 as a limited line credit insurance or other type of limited 
 lines producer in the person's home state shall receive a 
 nonresident limited lines producer license, under subdivision 1, 
 granting the same scope of authority as granted under the 
 license issued by the producer's home state.  For the purposes 
 of this subdivision, limited line insurance is any authority 
 granted by the home state that restricts the authority of the 
 license to less than the total authority prescribed in the 
 associated major lines pursuant to section 60K.38, subdivision 
 1, clauses (1) to (6). 

    HIST: 2001 c 117 art 1 s 10 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 10, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.40 Individuals licensed in another state; exemption 
  from examination. 

    Subdivision 1.    Availability.  An individual who 
 applies for an insurance producer license in this state who was 
 previously licensed for the same lines of authority in another 
 state is not required to complete any prelicensing education or 
 examination.  This exemption is only available if the person is 
 currently licensed in that state or if the application is 
 received within 90 days of the cancellation of the applicant's 
 previous license and if the prior state issues a certification 
 that, at the time of cancellation, the applicant was in good 
 standing in that state or the state's Producer Database records, 
 maintained by the National Association of Insurance 
 Commissioners, its affiliates, or subsidiaries, indicate that 
 the producer is or was licensed in good standing for the line of 
 authority requested. 

    Subd. 2.    Required application.  If a person licensed 
 as an insurance producer in another state who moves to this 
 state makes application within 90 days of establishing legal 
 residence to become a resident licensee under section 60K.37, no 
 prelicensing education or examination is required of that person 
 to obtain any line of authority previously held in the prior 
 state. 

    HIST: 2001 c 117 art 1 s 11 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 11, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.41 Assumed names. 

    An insurance producer doing business under any name other 
 than the producer's legal name shall provide the commissioner 
 with documentation that the assumed name has been properly filed 
 with the secretary of state before using the assumed name. 

    HIST: 2001 c 117 art 1 s 12 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 12, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.42 Temporary licensing. 

    Subdivision 1.    Commissioner's authority to grant.  
 The commissioner may issue a temporary insurance producer 
 license for a period not to exceed 180 days without requiring an 
 examination if the commissioner considers the temporary license 
 necessary for the servicing of an insurance business in the 
 following cases: 

    (1) to the surviving spouse or court-appointed personal 
 representative of a licensed insurance producer who dies or 
 becomes mentally or physically disabled to allow adequate time 
 for the sale of the insurance business owned by the producer or 
 for the recovery or return of the producer to the business or to 
 provide for the training and licensing of new personnel to 
 operate the producer's business; 

    (2) to a member or employee of a business entity licensed 
 as an insurance producer, upon the death or disability of an 
 individual designated in the business entity application or the 
 license; 

    (3) to the designee of a licensed insurance producer 
 entering active service in the armed forces of the United States 
 of America; or 

    (4) in any other circumstance where the commissioner 
 considers that the public interest will best be served by the 
 issuance of this license. 

    Subd. 2.    Limitations.  The commissioner may by order 
 limit the authority of any temporary licensee in any way 
 considered necessary to protect insureds and the public.  The 
 commissioner may require the temporary licensee to have a 
 suitable sponsor who is a licensed producer or insurer and who 
 assumes responsibility for all acts of the temporary licensee 
 and may impose other similar requirements designed to protect 
 insureds and the public.  The commissioner may by order revoke a 
 temporary license if the interests of insureds or the public are 
 endangered.  A temporary license may not continue after the 
 owner or the personal representative disposes of the business. 

    HIST: 2001 c 117 art 1 s 13 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 13, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.43 License denial, nonrenewal, or revocation. 

    Subdivision 1.    Causes.  The commissioner may, by 
 order, restrict, censure, suspend, revoke, or refuse to issue or 
 renew an insurance producer's license or may levy a civil 
 penalty under section 45.027 or any combination of actions, for 
 any one or more of the following causes: 

    (1) providing incorrect, misleading, incomplete, or 
 materially untrue information in the licensing application; 

    (2) violating any insurance laws, including chapter 45 or 
 chapters 60A to 72A, or violating any regulation, subpoena, or 
 order of the commissioner or of another state's insurance 
 commissioner; 

    (3) obtaining or attempting to obtain a license through 
 misrepresentation or fraud; 

    (4) improperly withholding, misappropriating, or converting 
 any money or properties received in the course of doing 
 insurance business; 

    (5) misrepresenting the terms of an actual or proposed 
 insurance contract or application for insurance; 

    (6) having pled guilty, with or without explicitly 
 admitting guilt, pled nolo contendere, or been convicted of a 
 felony, gross misdemeanor, or misdemeanor involving moral 
 turpitude, including, but not limited to, assault or similar 
 conduct; 

    (7) having admitted or been found to have committed any 
 insurance unfair trade practice or fraud; 

    (8) using fraudulent, coercive, or dishonest practices, or 
 demonstrating incompetence, untrustworthiness, or financial 
 irresponsibility whether or not involving the business of 
 insurance in this state or elsewhere; 

    (9) having an insurance producer license, or its 
 equivalent, denied, suspended, or revoked, or having been the 
 subject of a fine or any other discipline in any other state, 
 province, district, or territory; 

    (10) forging another's name to an application for insurance 
 or to any document, whether or not related to an insurance 
 transaction; 

    (11) improperly using notes or any other reference material 
 to complete an examination for an insurance license; 

    (12) knowingly accepting insurance business from an 
 individual who is not licensed; 

    (13) failing to comply with an administrative or court 
 order imposing a child support obligation; 

    (14) failing to pay state income tax or comply with any 
 administrative or court order directing payment of state income 
 tax; 

    (15) being permanently or temporarily enjoined by any court 
 of competent jurisdiction from engaging in or continuing any 
 conduct or practice involving any aspect of the insurance 
 business; 

    (16) making any communication to a potential buyer that 
 gives the impression that the producer is acting on behalf of a 
 government agency; or 

    (17) while performing residential mortgage activity 
 regulated under chapter 58, violating any notification, 
 disclosure, or recordkeeping requirement, or any standard of 
 conduct imposed by chapter 58. 

    Subd. 2.    Hearing rights.  (a) If the commissioner 
 determines that the producer is in violation of this section, 
 the commissioner may issue an order requiring a licensee to show 
 cause why any or all of the following should not occur: 

    (1) the revocation or suspension of the license; 

    (2) the censuring of the licensee; or 

    (3) the imposition of a civil penalty.  

    The order must be calculated to give reasonable notice of 
 the time and place for hearing on the matter and must state the 
 reasons for the entry of the order.  The commissioner may, by 
 order, summarily suspend a license pending final determination 
 of any 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 the provisions of chapter 14.  After the hearing, the 
 commissioner shall enter an order disposing of the matter as the 
 facts require.  If the licensee fails to appear at a hearing 
 after having been duly notified of it, the licensee shall be 
 considered in default, and the proceeding may be determined 
 against the licensee upon consideration of the order to show 
 cause, the allegations of which may be considered to be true.  

    (b) In the event that the action by the commissioner is to 
 nonrenew or to deny an application for a license, the 
 commissioner shall notify the applicant or licensee and advise, 
 in writing, the applicant or licensee of the reason for the 
 denial or nonrenewal of the applicant's or licensee's license.  
 The applicant or licensee may make written demand upon the 
 commissioner within 30 days for a hearing to determine the 
 reasonableness of the commissioner's action.  The hearing must 
 be held within 30 days and must be held pursuant to the 
 contested case provisions of chapter 14.  If no hearing is 
 requested within 30 days of service of the notice of nonrenewal 
 or denial, the nonrenewal or denial becomes final. 

    Subd. 3.    Actions against business entity.  The 
 license of a business entity may be suspended, revoked, or 
 refused if the commissioner finds, after hearing, that an 
 individual licensee's violation was known or should have been 
 known by one or more of the partners, officers, or managers 
 acting on behalf of the partnership or corporation and the 
 violation was not reported to the commissioner in a timely 
 manner. 

    Subd. 4.    Fine.  In addition to or in lieu of any 
 applicable denial, suspension, or revocation of a license, a 
 person may, after hearing, be subject to a civil fine according 
 to section 45.027, subdivision 6. 

    Subd. 5.    Other authority of the commissioner.  If a 
 license lapses, is surrendered, withdrawn, terminated, or 
 otherwise becomes ineffective, the commissioner may institute a 
 proceeding under this subdivision within two years after the 
 license was last effective and enter a revocation or suspension 
 order as of the last date on which the license was in effect, or 
 impose a civil penalty as provided for in section 45.027, 
 subdivision 6.  

    Subd. 6.    Conditions for relicensure.  A revocation of 
 a license prohibits the licensee from making a new application 
 for a license for at least two years from the effective date of 
 the revocation.  Further, the commissioner shall, as a condition 
 of reapplication, require the applicant to obtain a performance 
 bond issued by an insurer authorized to transact business in 
 this state in the amount of $20,000 or a greater amount the 
 commissioner considers appropriate for the protection of 
 citizens of this state in the event the commissioner grants the 
 application.  The bond must be filed with the commissioner, with 
 the state of Minnesota as obligee, conditioned for the prompt 
 payment to any aggrieved person entitled to payment of any 
 amounts received by the licensee or to protect any aggrieved 
 person from loss resulting from fraudulent, deceptive, 
 dishonest, or other prohibited practices arising out of any 
 transaction when the licensee was licensed or performed acts for 
 which a license is required under this chapter.  The bond 
 remains operative for as long as that licensee is licensed.  The 
 bond required by this subdivision must provide coverage for all 
 matters arising during the period of licensure.  

    HIST: 2001 c 117 art 1 s 14 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 14, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.44 Tax clearance certificate. 

    Subdivision 1.    Requirement for issuance or renewal of 
 license.  In addition to the provisions of section 60K.43, the 
 commissioner may not issue or renew a license if the 
 commissioner of revenue notifies the commissioner and the 
 licensee or applicant for a license that the licensee or 
 applicant owes the state delinquent taxes in the amount of $500 
 or more.  The commissioner may issue or renew the license only 
 if:  

    (1) the commissioner of revenue issues a tax clearance 
 certificate; and 

    (2) the commissioner of revenue or the licensee or 
 applicant forwards a copy of the clearance certificate to the 
 commissioner.  

 The commissioner of revenue may issue a clearance certificate 
 only if the licensee or applicant does not owe the state any 
 uncontested delinquent taxes. 

    Subd. 2.    Definitions.  For purposes of this section, 
 the following terms have the meanings given them: 

    (1) "taxes" are all taxes payable to the commissioner of 
 revenue, including penalties and interest due on those taxes; 
 and 

    (2) "delinquent taxes" do not include a tax liability if (i)
 an administrative or court action that contests the amount or 
 validity of the liability has been filed or served, (ii) the 
 appeal period to contest the tax liability has not expired, or 
 (iii) the licensee or applicant has entered into a payment 
 agreement to pay the liability and is current with the payments. 

    Subd. 3.    Contested case hearing.  In lieu of the 
 notice and hearing requirements of section 60K.43, when a 
 licensee or applicant is required to obtain a clearance 
 certificate under this section, a contested case hearing must be 
 held if the licensee or applicant requests a hearing in writing 
 to the commissioner of revenue within 30 days of the date of the 
 notice provided in subdivision 1.  The hearing must be held 
 within 45 days of the date the commissioner of revenue refers 
 the case to the office of administrative hearings.  
 Notwithstanding any law to the contrary, the licensee or 
 applicant must be served with 20 days' notice in writing 
 specifying the time and place of the hearing and the allegations 
 against the licensee or applicant.  The notice may be served 
 personally or by mail. 

    Subd. 4.    Identification required.  The commissioner 
 shall require all licensees or applicants to provide their 
 social security number and Minnesota business identification 
 number on all license applications.  Upon request of the 
 commissioner of revenue, the commissioner must provide to the 
 commissioner of revenue a list of all licensees and applicants, 
 including the name and address, social security number, and 
 business identification number.  The commissioner of revenue may 
 request a list of the licensees and applicants no more than once 
 each calendar year.  

    HIST: 2001 c 117 art 1 s 15 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 15, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.45 Surrender of license. 

    The commissioner shall promptly notify the licensee and all 
 appointing insurers, where applicable, of any suspension, 
 revocation, or termination of the licensee's producer license by 
 the commissioner.  Upon receipt of the notice of suspension or 
 revocation of a license, the licensee shall immediately deliver 
 it to the commissioner. 

    HIST: 2001 c 117 art 1 s 16 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 16, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.46 Required acts. 

    Subdivision 1.    Personal solicitation of insurance 
 sales.  (a) For the purpose of this section, "personal 
 solicitation" means any contact by a producer, or any person 
 acting on behalf of a producer, made for the purpose of selling 
 or attempting to sell insurance, when either the producer or the 
 person acting for the producer contacts the buyer in person, by 
 telephone, or by electronic means, except:  

    (1) an attempted sale in which the buyer personally knows 
 the identity of the producer, the name of the general agency, if 
 any, which the producer represents, and the fact that the 
 producer is an insurance producer; 

    (2) an attempted sale in which the prospective purchaser of 
 insurance initiated the contact; or 

    (3) a personal contact which takes place at the producer's 
 place of business. 

    (b) Before a personal solicitation, the producer or person 
 acting for a producer shall, at the time of initial personal 
 contact with the potential buyer, clearly and expressly disclose 
 in writing: 

    (1) the name of the person making the contact; 

    (2) the name of the producer, general agency, or insurer 
 that the person represents; and 

    (3) the fact that the producer, agency, or insurer is in 
 the business of selling insurance.  

    If the initial personal contact is made by telephone, the 
 disclosures required by this subdivision need not be made in 
 writing.  

    Subd. 2.    Fees for services.  No person shall charge a 
 fee for any services rendered in connection with the 
 solicitation, negotiation, or servicing of any insurance 
 contract unless: 

    (1) before rendering the services, a written statement is 
 provided disclosing: 

    (i) the services for which fees are charged; 

    (ii) the amount of the fees; 

    (iii) that the fees are charged in addition to premiums; 
 and 

    (iv) that premiums include a commission; and 

    (2) all fees charged are reasonable in relation to the 
 services rendered.  

    Subd. 3.    Commissions or compensation.  A duly 
 licensed producer may pay commissions or assign or direct that 
 commissions be paid to a partnership of which the producer is a 
 member, employee, or agent, or to a corporation of which the 
 producer is an officer, employee, or agent. 

    Subd. 4.    Suitability of insurance.  In recommending 
 the purchase of any life, endowment, individual accident and 
 sickness, long-term care, annuity, life-endowment, or Medicare 
 supplement insurance to a customer, a producer must have 
 reasonable grounds for believing that the recommendation is 
 suitable for the customer and must make reasonable inquiries to 
 determine suitability.  The suitability of a recommended 
 purchase of insurance will be determined by reference to the 
 totality of the particular customer's circumstances, including, 
 but not limited to, the customer's income, the customer's need 
 for insurance, and the values, benefits, and costs of the 
 customer's existing insurance program, if any, when compared to 
 the values, benefits, and costs of the recommended policy or 
 policies.  This subdivision does not apply to limited lines 
 insurance under section 60K.38, subdivision 1, paragraph (c). 

    Subd. 5.    Premiums.  All premiums or other money 
 received by a producer from an insured or applicant for 
 insurance must be promptly deposited directly in a business 
 checking, savings, or other similar account maintained by the 
 producer or agency, unless the money is forwarded directly to 
 the designated insurer. 

    Subd. 6.    Privacy of insured.  Except as otherwise 
 provided by law, no insurance producer may disclose or cause to 
 be disclosed to any other person the identity of a person 
 insured through the producer without the consent of the insured. 

    Subd. 7.    Altering existing policies; written binders 
 required.  An insurance producer having express authority to 
 bind coverage, who orally agrees on behalf of an insurer to 
 provide insurance coverage, or to alter an existing insurance 
 agreement, shall execute and deliver a written memorandum or 
 binder containing the terms of the oral agreement to the insured 
 within three business days from the time the oral agreement is 
 entered. 

    HIST: 2001 c 117 art 1 s 17 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 17, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.47 Liability for placing insurance in unauthorized 
  company. 

    Any person, whether or not licensed as an insurance 
 producer, who participates in any manner in the sale of any 
 insurance policy or certificate, or any other contract providing 
 benefits, for or on behalf of any company that is required to 
 be, but that is not authorized to engage in the business of 
 insurance in this state, other than pursuant to sections 60A.195 
 to 60A.209, is personally liable for all premiums, whether 
 earned or unearned, paid by the insured, and the premiums may be 
 recovered by the insured.  In addition, that person is 
 personally liable for any loss the insured has sustained or may 
 sustain if the loss is one resulting from a risk or hazard 
 covered in the issued policy, certificate, or contract, or which 
 would have been covered if the policy, certificate, or contract 
 had been issued to the purchaser of the insurance. 

    HIST: 2001 c 117 art 1 s 18 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 18, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.48 Commissions. 

    Subdivision 1.    Payment prohibited.  An insurance 
 company or insurance producer shall not pay a commission, 
 service fee, brokerage, or other valuable consideration to a 
 person for selling, soliciting, or negotiating insurance in this 
 state if that person is required to be licensed under sections 
 60K.31 to 60K.57 and is not so licensed.  

    Subd. 2.    Acceptance prohibited.  A person shall not 
 accept a commission, service fee, brokerage, or other valuable 
 consideration for selling, soliciting, or negotiating insurance 
 in this state if that person is required to be licensed under 
 sections 60K.31 to 60K.57 and is not so licensed. 

    Subd. 3.    Exceptions.  (a) Renewal or other deferred 
 commissions may be paid to a person for selling, soliciting, or 
 negotiating insurance in this state if the person was required 
 to be licensed under sections 60K.31 to 60K.57 at the time of 
 the sale, solicitation, or negotiation and was so licensed at 
 that time. 

    (b) An insurer or insurance producer may pay or assign 
 commissions, service fees, brokerages, or other valuable 
 consideration to an insurance agency or to persons who do not 
 sell, solicit, or negotiate insurance in this state, unless the 
 payment would constitute an illegal rebate or otherwise violate 
 section 72A.20, subdivision 10.  A duly licensed producer may 
 pay commissions or assign or direct that commissions be paid to 
 a partnership of which the producer is a member, employee, or 
 agent, or to a corporation of which the agent is an officer, 
 employee, or agent. 

    HIST: 2001 c 117 art 1 s 19 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 19, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.49 Appointments. 

    Subdivision 1.    Agent of insurer.  A person performing 
 acts requiring a producer license under this chapter is at all 
 times the agent of the insurer and not the insured. 

    Subd. 2.    Requirements.  Except as described in 
 subdivision 3, a licensed insurance producer shall not engage in 
 the business of insurance with an insurer unless the producer 
 either: 

    (1) has been appointed by that insurer; or 

    (2) has the permission of the insurer to transact business 
 on its behalf and obtains an appointment from the insurer within 
 15 days after the first application is submitted to the insurer. 

    Subd. 3.    Exception.  A licensed insurance producer 
 may, in response to the needs of a customer, procure insurance 
 in a class of insurance for which the producer is licensed from 
 an insurer by which the producer is not appointed, if the 
 transaction is consummated through an appointed agent of the 
 insurer. 

    Subd. 4.    Procedure.  To appoint a producer as its 
 agent, the appointing insurer shall file, in a format approved 
 by the commissioner, a notice of appointment within 15 days from 
 the date the agency contract is executed or the first insurance 
 application is submitted.  An insurer may also elect to appoint 
 a producer to all or some insurers within the insurer's holding 
 company system or group by the filing of a single appointment 
 request.  No insurer shall appoint a producer until the producer 
 obtains a license under this chapter.  

    Subd. 5.    Eligibility.  Upon receipt of the notice of 
 appointment, the commissioner shall verify within a reasonable 
 time not to exceed 30 days that the insurance producer is 
 eligible for appointment.  If the insurance producer is 
 determined to be ineligible for appointment, the commissioner 
 shall notify the insurer within five days of its determination. 

    Subd. 6.    Fees.  An insurer shall pay an appointment 
 fee, in the amount and method of payment set forth in section 
 60A.14, subdivision 1, for each insurance producer appointed by 
 the insurer.  

    Subd. 7.    Period of effectiveness.  Appointments shall 
 remain in force until voluntarily terminated by the insurer or 
 the producer, or until the license of the producer has been 
 terminated for any reason.  An insurer may terminate the 
 appointment at any time by notifying the commissioner and the 
 producer under section 60K.51.  If the insurer does not specify 
 an effective date, the termination is effective on the date the 
 notice is received by the commissioner.  Within 30 days after 
 the insurer gives notice to the commissioner, the insurer shall 
 furnish the producer with a current statement of the producer's 
 commission account.  

    HIST: 2001 c 117 art 1 s 20 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 20, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.50 Limitation on appointments. 

    No insurer or representative of an insurer shall knowingly 
 appoint a producer who is known to the insurer or representative 
 to have engaged in any of the activities in section 60K.43 or to 
 be otherwise unqualified or unfit.  Upon discovery by the 
 insurer or a representative of the insurer that an appointed 
 producer has engaged in any of the activities in section 60K.43 
 or is otherwise unqualified or unfit, the insurer shall 
 immediately terminate the appointment and notify the 
 commissioner as set forth in section 60K.51.  No insurer shall 
 employ a producer whose license has been revoked. 

    HIST: 2001 c 117 art 1 s 21 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 21, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.51 Notification to commissioner of termination. 

    Subdivision 1.    Termination for cause.  An insurer or 
 authorized representative of the insurer that terminates the 
 appointment, employment, contract, or other insurance business 
 relationship with a producer shall notify the commissioner 
 within 30 days following the effective date of the termination, 
 using a format acceptable to the commissioner, if the reason for 
 termination is one of the reasons set forth in section 60K.43 or 
 the insurer has knowledge that the producer was found by a 
 court, government body, or self-regulatory organization 
 authorized by law to have engaged in any of the activities in 
 section 60K.43.  Upon the written request of the commissioner, 
 the insurer shall provide additional information, documents, 
 records, or other data pertaining to the termination or activity 
 of the producer. 

    Subd. 2.    Termination without cause.  An insurer or 
 authorized representative of the insurer that terminates the 
 appointment, employment, or contract with a producer for any 
 reason not set forth in section 60K.43 shall notify the 
 commissioner within 30 days following the effective date of the 
 termination, using a format acceptable to the commissioner.  
 Upon written request of the commissioner, the insurer shall 
 provide additional information, documents, records, or other 
 data pertaining to the termination. 

    Subd. 3.    Ongoing notification requirement.  The 
 insurer or the authorized representative of the insurer shall 
 promptly notify the commissioner in a format acceptable to the 
 commissioner if, upon further review or investigation, the 
 insurer discovers additional information that would have been 
 reportable to the commissioner under subdivision 1 had the 
 insurer then known of its existence. 

    Subd. 4.    Copy of notification to be provided to 
 producer.  (a) Within 15 days after making the notification 
 required by subdivisions 1 to 3, the insurer shall mail a copy 
 of the notification to the producer at the producer's last known 
 address.  If the producer is terminated for cause for any of the 
 reasons listed in section 60K.43, the insurer shall provide a 
 copy of the notification to the producer at the producer's last 
 known address by certified mail, return receipt requested, 
 postage prepaid, or by overnight delivery using a nationally 
 recognized carrier. 

    (b) Within 30 days after the producer has received the 
 original or additional notification, the producer may file 
 written comments concerning the substance of the notification 
 with the commissioner.  The producer shall, by the same means, 
 simultaneously send a copy of the comments to the reporting 
 insurer.  The comments become a part of the commissioner's file 
 and must accompany every copy of a report distributed or 
 disclosed for any reason about the producer as permitted under 
 subdivision 6. 

    Subd. 5.    Immunities.  (a) In the absence of actual 
 malice, an insurer, the authorized representative of the 
 insurer, a producer, the commissioner, or an organization of 
 which the commissioner is a member and that compiles the 
 information and makes it available to other insurance 
 commissioners or regulatory or law enforcement agencies is not 
 subject to civil liability, and no civil cause of action arises 
 against these entities or their respective agents or employees, 
 as a result of any statement or information required by or 
 provided pursuant to this section or any information relating to 
 any statement that may be requested in writing by the 
 commissioner, from an insurer or producer.  The immunity granted 
 in this subdivision extends to a statement by a terminating 
 insurer or producer to an insurer or producer limited solely and 
 exclusively to whether a termination for cause under subdivision 
 1 was reported to the commissioner, provided that the propriety 
 of any termination for cause under subdivision 1 is certified in 
 writing by an officer or authorized representative of the 
 insurer or producer terminating the relationship. 

    (b) In any action brought against a person that may have 
 immunity under paragraph (a) for making any statement required 
 by this section or providing any information relating to any 
 statement that may be requested by the commissioner, the party 
 bringing the action shall plead specifically in any allegation 
 that paragraph (a) does not apply because the person making the 
 statement or providing the information did so with actual malice.

    (c) Paragraph (a) or (b) does not abrogate or modify any 
 existing statutory or common law privileges or immunities. 

    Subd. 6.    Classification of investigative data.  Any 
 documents, materials, or other information in the control or 
 possession of the department of commerce that is furnished by an 
 insurer, producer, or an employee or agent of an insurer or 
 producer acting on behalf of the insurer or producer, or 
 obtained by the commissioner in an investigation pursuant to 
 this section is classified as confidential or private data 
 pursuant to section 13.41, subdivision 2. 

    HIST: 2001 c 117 art 1 s 22 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 22, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.52 Use and sharing of licensing and investigative 
  data. 

    Subdivision 1.    Commissioner's authority.  In order to 
 assist in the performance of the commissioner's duties under 
 sections 60K.31 to 60K.57, the commissioner: 

    (1) may share licensing data or any active or inactive 
 investigative data with other state, federal, and international 
 regulatory agencies, with the National Association of Insurance 
 Commissioners, its affiliates or subsidiaries, and with state, 
 federal, and international law enforcement authorities if the 
 recipient agrees to maintain the data in a manner consistent 
 with its data classification; 

    (2) may receive documents, materials, or information, 
 including otherwise confidential and privileged documents, 
 materials, or information, from the National Association of 
 Insurance Commissioners, its affiliates or subsidiaries, and 
 from regulatory and law enforcement officials of other foreign 
 or domestic jurisdictions, and shall maintain as confidential or 
 privileged any document, material, or information received with 
 notice or the understanding that it is confidential or 
 privileged under the laws of the jurisdiction that is the source 
 of the document, material, or information; and 

    (3) may enter into agreements governing sharing and use of 
 information consistent with this subdivision. 

    No waiver of any applicable privilege or claim of 
 confidentiality in the documents, materials, or information 
 occurs as a result of disclosure to the commissioner under this 
 section or as a result of sharing as authorized in this 
 subdivision. 

    Nothing in sections 60K.31 to 60K.57 prohibits the 
 commissioner from releasing information concerning final, 
 adjudicated actions, including for-cause terminations, to a 
 database or other clearinghouse service maintained by the 
 National Association of Insurance Commissioners, its affiliates, 
 or subsidiaries of the National Association of Insurance 
 Commissioners. 

    Subd. 2.    Penalties for failing to report.  An 
 insurer, the authorized representative of the insurer, or a 
 producer that fails to report as required under this section or 
 that is found to have reported with actual malice by a court of 
 competent jurisdiction may, after notice and hearing, have its 
 license or certificate of authority suspended or revoked and may 
 be fined in accordance with section 45.027. 

    HIST: 2001 c 117 art 1 s 23 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 23, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.53 Reciprocity. 

    Subdivision 1.    Nonresident license waiver.  The 
 commissioner shall waive any requirements for a nonresident 
 license applicant with a valid license from the applicant's home 
 state, except the requirements imposed by section 60K.39, if the 
 applicant's home state awards nonresident licenses to residents 
 of this state on the same basis. 

    Subd. 2.    Continuing education requirements.  A 
 nonresident producer's satisfaction of that person's home 
 state's continuing education requirements for licensed insurance 
 producers constitutes satisfaction of this state's continuing 
 education requirements if the nonresident producer's home state 
 recognizes the satisfaction of its continuing education 
 requirements imposed upon producers from this state on the same 
 basis. 

    HIST: 2001 c 117 art 1 s 24 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 24, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.54 Reporting of actions. 

    Subdivision 1.    Administrative actions.  A producer 
 shall report to the commissioner any administrative action taken 
 against the producer in another jurisdiction or by another 
 governmental agency in this state within 30 days of the final 
 disposition of the matter.  This report must include a copy of 
 the order, consent to order, or other relevant legal documents. 

    Subd. 2.    Criminal prosecutions.  Within 30 days of 
 the initial pretrial hearing date, a producer shall report to 
 the commissioner any criminal prosecution of the producer taken 
 in any jurisdiction.  The report must include a copy of the 
 initial complaint filed, the order resulting from the hearing, 
 and any other relevant legal documents.  In addition, a producer 
 shall report to the commissioner within ten days any conviction, 
 guilty plea, or plea of nolo contendere to any felony or gross 
 misdemeanor.  

    HIST: 2001 c 117 art 1 s 25 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 25, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.55 Fees. 

    Subdivision 1.    Renewal fees.  Each producer licensed 
 under this chapter shall pay a renewal fee as prescribed by 
 subdivision 2. 

    Subd. 2.    Licensing fees.  (a) In addition to fees 
 provided for examinations, each insurance producer licensed 
 under this chapter shall pay to the commissioner a fee of: 

    (1) $40 for an initial life, accident and health, property, 
 or casualty license issued to an individual insurance producer, 
 and a fee of $40 for each renewal; 

    (2) $75 for an initial variable life and variable annuity 
 license issued to an individual insurance producer, and a fee of 
 $50 for each renewal; 

    (3) $80 for an initial personal lines license issued to an 
 individual insurance producer, and a fee of $80 for each 
 renewal; 

    (4) $80 for an initial limited lines license issued to an 
 individual insurance producer, and a fee of $80 for each 
 renewal; 

    (5) $200 for an initial license issued to a business 
 entity, and a fee of $150 for each renewal; and 

    (6) $500 for an initial surplus lines license, and a fee of 
 $500 for each renewal. 

    (b) Initial licenses issued under this chapter are valid 
 for a period not to exceed 24 months and expire on October 31 of 
 the renewal year assigned by the commissioner.  Each renewal 
 insurance producer license is valid for a period of 24 months.  
 Licensees who submit renewal applications postmarked or 
 delivered on or before October 15 of the renewal year may 
 continue to transact business whether or not the renewal license 
 has been received by November 1.  Licensees who submit 
 applications postmarked or delivered after October 15 of the 
 renewal year must not transact business after the expiration 
 date of the license until the renewal license has been received. 

    (c) All fees are nonreturnable, except that an overpayment 
 of any fee may be refunded upon proper application.  

    HIST: 2001 c 117 art 1 s 26 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 26, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.

     60K.56 Continuing insurance education. 

    Subdivision 1.    Definition.  For the purposes of this 
 section, "course" means a course, program of instruction, or 
 seminar of continuing insurance education.  A "professional 
 designation examination" means a written, proctored, and graded 
 examination the passage of which leads to a bona fide insurance 
 or financial planning professional designation used by insurance 
 producers.  

    Subd. 2.    Applicability.  This section applies to all 
 natural persons licensed by this state to sell lines of 
 insurance for which licensing examinations are required.  

    Subd. 3.    Exemptions.  This section does not apply to 
 persons soliciting or selling solely on behalf of companies 
 organized and operating according to chapter 67A. 

    Subd. 4.    Powers of the commissioner.  (a) The 
 commissioner shall make the final determination as to 
 accreditation and assignment of credit hours for courses.  

    (b) The commissioner shall adopt procedures for reporting 
 compliance with the minimum education requirement.  

    (c) The commissioner shall adopt rules according to chapter 
 14 to carry out the purposes of this section.  

    Subd. 5.    Criteria for course accreditation.  (a) The 
 commissioner may accredit a course only to the extent it is 
 designed to impart substantive and procedural knowledge of the 
 insurance field.  The burden of demonstrating that the course 
 satisfies this requirement is on the individual or organization 
 seeking accreditation.  The commissioner shall approve any 
 educational program approved by Minnesota Continuing Legal 
 Education relating to the insurance field.  The commissioner is 
 authorized to establish a procedure for renewal of course 
 accreditation. 

    (b) The commissioner shall approve or disapprove 
 professional designation examinations that are recommended for 
 approval by the advisory task force.  In order for an insurance 
 producer to receive full continuing education credit for a 
 professional designation examination, the producer must pass the 
 examination.  A producer may not receive credit for classroom 
 instruction preparing for the professional designation 
 examination and also receive continuing education credit for 
 passing the professional designation examination. 

    (c) The commissioner may not accredit a course:  

    (1) that is designed to prepare students for a license 
 examination; 

    (2) in mechanical office or business skills, including 
 typing, speedreading, use of calculators, or other machines or 
 equipment; 

    (3) in sales promotion, including meetings held in 
 conjunction with the general business of the licensed agent; or 

    (4) in motivation, the art of selling, psychology, or time 
 management. 

    Subd. 6.    Minimum education requirement.  Each person 
 subject to this section shall complete a minimum of 30 credit 
 hours of courses accredited by the commissioner during each 
 24-month licensing period.  Any person whose initial licensing 
 period extends more than six months shall complete 15 hours of 
 courses accredited by the commissioner during the initial 
 license period.  Any person teaching or lecturing at an 
 accredited course qualifies for 1-1/2 times the number of credit 
 hours that would be granted to a person completing the 
 accredited course.  No more than 15 credit hours per licensing 
 period may be credited to a person for courses sponsored by, 
 offered by, or affiliated with an insurance company or its 
 agents.  Courses sponsored by, offered by, or affiliated with an 
 insurance company or agent may restrict its students to agents 
 of the company or agency. 

    Subd. 7.    Waiver of requirements.  (a) The 
 commissioner may grant a waiver or an extension of time up to 90 
 days to complete the minimum education requirement to an 
 individual upon a showing of good cause.  It is the licensed 
 person's responsibility to request a waiver or extension on a 
 form prescribed by the commissioner.  As of the day the licensed 
 person properly files a request for a waiver or extension, the 
 license remains in effect until the commissioner notifies the 
 licensed person of the commissioner's decision.  The 
 commissioner may approve a waiver or extension subject to any 
 reasonable conditions.  The person's license remains in effect 
 during the compliance period determined by the commissioner.  If 
 the licensed person fails to comply with any reasonable 
 conditions imposed by the commissioner, the commissioner shall 
 terminate the license.  If the request for a waiver or extension 
 is denied by the commissioner, the licensed person shall have 30 
 days within which to satisfy the minimum education requirement 
 involved in the request for a waiver or extension.  If the 
 minimum education requirement is not satisfied within the 
 compliance period, the commissioner shall terminate the person's 
 license.  

    (b) Upon application on a form prescribed by the 
 commissioner, the commissioner may grant a waiver of the minimum 
 education requirement to a licensee who is no longer actively 
 engaged in the solicitation and sale of insurance.  A licensed 
 person seeking a waiver from the requirements of this section 
 may be required to submit information to the commissioner that 
 substantiates the person's retirement or inactive status.  A 
 licensed person receiving a waiver from the commissioner may 
 maintain and renew a license but may not solicit or sell new 
 insurance business while this waiver is in effect.  A licensee 
 may, for a fee, continue to service an insurance policy for 
 which the licensee is the producer of record, if the policy is 
 in force at the time the waiver is granted.  An insurer may not 
 terminate a service contract or refuse to pay compensation 
 because the waiver does not allow the licensee to solicit or 
 sell new insurance.  

    For the purposes of receiving renewal commissions and other 
 benefits or compensation from insurers, an agent receiving a 
 waiver under this paragraph is considered to be the holder of a 
 valid insurance producer license in this state.  

    Subd. 8.    Reporting.  (a) After completing the minimum 
 education requirement, each person subject to this section shall 
 file or cause to be filed a compliance report in accordance with 
 the procedures adopted by the commissioner.  The compliance 
 report must not claim credit for continuing education not 
 actually completed at the date of filing the report. 

    (b) An institution offering an accredited course shall 
 comply with the procedure for reporting compliance adopted by 
 the commissioner.  

    (c) If a person subject to this section completes a 
 nonaccredited course, that person 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.  

    Subd. 9.    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 licensing 
 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 producer 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.  

    HIST: 2001 c 117 art 1 s 27 

*   NOTE:  This section, as added by Laws 2001, chapter 117, 
*article 1, section 27, is effective July 1, 2002.  Laws 2001, 
*chapter 117, article 1, section 29.