Bill Text: MS HB1156 | 2010 | Regular Session | Engrossed
Bill Title: Insurance companies; increase privilege taxes and license fees for foreign and domestic companies.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2010-03-02 - Died In Committee [HB1156 Detail]
Download: Mississippi-2010-HB1156-Engrossed.html
MISSISSIPPI LEGISLATURE
2010 Regular Session
To: Insurance
By: Representative Robinson
House Bill 1156
(As Passed the House)
AN ACT TO AMEND SECTION 27-15-83, MISSISSIPPI CODE OF 1972, TO INCREASE THE PRIVILEGE TAX AND LICENSE FEES FOR FOREIGN AND DOMESTIC INSURANCE COMPANIES; TO AMEND SECTION 83-5-15, MISSISSIPPI CODE OF 1972, TO INCREASE THE AGGREGATE AMOUNT OF LICENSE FEES WHICH MAY BE IMPOSED ON AN INSURANCE COMPANY FOR EACH CLASS OF BUSINESS; TO AMEND SECTION 83-21-17, MISSISSIPPI CODE OF 1972, TO INCREASE THE ANNUAL FEE PAID BY NONADMITTED INSURERS IN ORDER TO BE ELIGIBLE FOR CERTIFICATION BY THE COMMISSIONER OF INSURANCE; TO AMEND SECTION 83-19-31, MISSISSIPPI CODE OF 1972, TO CONFORM TO THE PROVISIONS OF THIS ACT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-15-83, Mississippi Code of 1972, is amended as follows:
27-15-83. (1) Upon each foreign insurance company licensed as a single line company defined under Section 83-19-1, the privilege tax is as follows:
(a) Fire and Allied Lines * * *.............. $500.00
(b) Industrial Fire.......................... $500.00
(c) Casualty/Liability....................... $500.00
(d) Fidelity * * *........................... $500.00
(e) Surety................................... $500.00
(f) Workers' Compensation.................... $500.00
(g) Boiler and Machinery..................... $500.00
(h) Plate Glass.............................. $500.00
(i) Aircraft................................. $500.00
(j) Inland Marine * * *...................... $500.00
(k) Ocean Marine............................. $500.00
(l) Automobile Physical Damage/Automobile
Liability................................ $500.00
(m) Homeowners/Farmowners.................... $500.00
(n) Guaranty * * *........................... $500.00
(o) Mortgage Guaranty........................ $500.00
(p) Trip Accident and Baggage................ $500.00
(q) Legal.................................... $500.00
(r) Credit Property.......................... $500.00
(s) Life and/or Accident and Health;
Credit Life, Accident and Health;
Industrial Life, Accident and Health;
and Variable Contracts................... $500.00
(t) Title.................................... $500.00
(u) Fraternal................................ $ 50.00
(2) For any combination of classifications of a foreign insurance company, the privilege tax for a multiple line company shall be One Thousand Dollars ($1,000.00).
(3) Any stock, mutual, reciprocal or reinsurance company shall pay the appropriate privilege tax for each line of insurance the company is licensed to underwrite.
(4) For each domestic insurance company which has its home office located in Mississippi, the privilege tax shall be one-half (1/2) of the fees listed in this section.
(5) Each insurance company or association which amends its privilege license shall pay a fee of Fifty Dollars ($50.00).
SECTION 2. Section 83-5-15, Mississippi Code of 1972, is amended as follows:
83-5-15. No insurance company admitted to do business in the state shall be authorized to transact more than one (1) class or kind of insurance, unless it shall pay the license fees for each class and have the requisite capital for each business engaged in. A life insurance company may do an accident business and a fire insurance company may transact insurance as prescribed in Section 83-19-1 * * *, with the payment of the privilege tax for a multiple line company as required by Section 27-15-83. No insurance company or other insurer shall be required to pay license fees amounting in the aggregate to more than One Thousand Dollars ($1,000.00) per annum.
SECTION 3. Section 83-21-17, Mississippi Code of 1972, is amended as follows:
83-21-17. The Commissioner of Insurance shall annually promulgate a list of nonadmitted insurers and each such insurer shall meet the same requirements as to capital and surplus as is required of a company licensed to do business in the State of Mississippi and annually pay a filing fee of One Thousand Dollars ($1,000.00) in order to be eligible for certification as a nonadmitted insurer. An alien insurer shall be listed with the nonadmitted Insurers Information Office of the National Association of Insurance Commissioners. In the case of an alien insurer authorized to transact insurance of the kind involved in at least one (1) state of the United States, the insurer must have unimpaired capital and/or surplus or an effective trust fund amounting to at least One Million Five Hundred Thousand Dollars ($1,500,000.00) and, in the case of a group including incorporated and individual unincorporated insurers, the trust fund must be in the amount of not less than Fifty Million Dollars ($50,000,000.00). The incorporated members of the group shall not be engaged in any business other than underwriting as a member of the group and shall be subject to the same level of solvency regulation and control by the group's domiciliary regulator as are the unincorporated members. In the case of an alien insurer not authorized to transact business in at least one (1) state of the United States, the insurer must have an established trust fund of at least One Million Five Hundred Thousand Dollars ($1,500,000.00) within the United States administered by a recognized financial institution and held for the benefit of all its policyholders in the United States. The Commissioner of Insurance is specifically vested with authority to promulgate such rules and regulations as deemed necessary to carry out the provisions hereof and to publish a list of nonadmitted insurers found eligible for writing business in the State of Mississippi on a nonadmitted basis. The commissioner may, by giving seven (7) days' notice, at any time remove a nonadmitted insurer from such eligible list when it appears that such insurer no longer meets the requirements of the statute or regulations of the commissioner. When a nonadmitted insurer is placed upon or removed from the eligible list, all agents holding licenses under Sections 83-21-17 through 83-21-31 shall be notified of such eligibility or removal. Any agent of this state who places insurance with a nonadmitted insurer not on the list of eligible insurers shall be deemed in violation of the cited sections and shall be subject to revocation of license in the manner provided by statute for revocation of license of fire and casualty insurance agents.
SECTION 4. Section 83-19-31, Mississippi Code of 1972, is amended as follows:
83-19-31. (1) No corporation so formed shall transact any other business than that specified in its charter and articles of association. Companies so formed must meet the following capital and surplus requirements:
(a) Single-line companies so formed to write a classification listed in Section 27-15-83(1)(a) through (s), the minimum capital requirement shall be Four Hundred Thousand Dollars ($400,000.00) and the surplus shall be a minimum of Six Hundred Thousand Dollars ($600,000.00).
(b) Multi-line companies so formed to write a combination of the classifications listed in Section 27-15-83(1)(a) through (s), the minimum capital requirement shall be Six Hundred Thousand Dollars ($600,000.00) and the surplus shall be a minimum of Nine Hundred Thousand Dollars ($900,000.00).
(c) Companies so formed for the purpose of transacting the business of life insurance on the industrial plan may organize with a minimum capital of One Hundred Thousand Dollars ($100,000.00) and a minimum surplus of Fifty Thousand Dollars ($50,000.00).
An industrial life insurer shall be limited to the following:
1. A life insurance policy, in the aggregate value of Five Thousand Dollars ($5,000.00) in death benefits, exclusive of multiple indemnity benefits.
2. A disability policy in the aggregate benefits of Sixty Dollars ($60.00) per week.
3. A policy providing benefits for dismembered and broken limbs and/or loss of eyesight in the aggregate of Five Thousand Dollars ($5,000.00) per policy year.
4. A policy which provides benefits for the payment for or furnishing of hospitalization, drugs, attending physicians and surgical costs in the aggregate of Three Thousand Five Hundred Dollars ($3,500.00) per policy year.
(d) All mutual and reciprocal companies shall possess at the time of initial license and maintain thereafter a surplus, after deductions for services, in an amount equal to the capital and surplus requirements of a stock company writing similar lines of insurance.
(e) If at any time the surplus of such domestic company or association shall be less than the minimum surplus noted above, such company or association shall be considered impaired; and it shall be the duty of the officers of such company or association to report any such impairment of surplus to the State Commissioner of Insurance in writing within ten (10) days after such impairment occurs. When any such impairment is reported, or if the Commissioner of Insurance should determine that the company is operating in an impaired condition, the commissioner may suspend the certificate of authority and license of such domestic insurance company or association to do business in this state until such company shall raise or increase its surplus to the minimum amount required herein.
(2) Any domestic company qualifying under the foregoing sections shall deposit with the State Treasurer fifty percent (50%) of its capital stock, either in cash or in such bonds or securities in which such company is authorized by law to invest its funds. Upon such deposit and evidence, by affidavit or otherwise, satisfactory to the Insurance Commissioner that the capital and surplus is all paid in and that the company is the actual and unqualified owner of the securities representing the paid-up capital and surplus, he shall issue to such company his certificate authorizing it to transact business in this state.
The provisions of this section as to the minimum requirements as to paid-up capital stock and cash surplus shall not become effective until January 1, 1988, concerning any domestic company which was authorized to do business and was writing business in this state on July 1, 1985.
Notwithstanding any other provision of law, the securities qualified for deposit under this section may be deposited with a clearing corporation or held in the Federal Reserve book-entry system. Securities deposited with a clearing corporation or held in the Federal Reserve book-entry system and used to meet the deposit requirements set forth in this section shall be under the control of the Insurance Commissioner and shall not be withdrawn by the insurance company without the approval of the Insurance Commissioner. Any insurance company holding securities in such manner shall provide to the Insurance Commissioner evidence issued by its custodian or member bank through which such insurance company has deposited such securities in a clearing corporation or through which such securities are held in the Federal Reserve book-entry system, respectively, in order to establish that the securities are actually recorded in an account in the name of the custodian or other direct participant or member bank, and that the records of the custodian, other participant or member bank reflect that such securities are held subject to the order of the Insurance Commissioner.
(3) No insurance company, including any mutual insurance company, organized under the laws of this state and transacting business in this state shall expose itself to loss on any one (1) risk or hazard to an amount exceeding ten percent (10%) of its paid-up capital and surplus unless the excess is reinsured in some other company duly authorized to transact similar business in this state or as otherwise provided in the insurance code. For purposes of this subsection, the terms "risk" and "hazard" apply to the subject matter of any one (1) insurance policy and not to any one (1) peril.
(4) The Commissioner of Insurance may require additional capital and surplus based on the type, nature or volume of business transacted.
SECTION 5. This act shall take effect and be in force from and after July 1, 2010.
