All insurance charges or premiums collected by an administrator on behalf of or for an insurer and return premiums received from the insurer must be held by the administrator in a fiduciary capacity. The funds must be immediately remitted to the person entitled thereto or deposited promptly in a fiduciary bank account established and maintained by the administrator. If charges or premiums so deposited are collected on behalf of or for more than one insurer, the administrator shall cause the bank in which the fiduciary account is maintained to keep records clearly recording the deposits in and withdrawals from the account on behalf of or for each insurer. The administrator shall promptly obtain and keep copies of all records and, upon request of an insurer, furnish the insurer with copies of the records pertaining to deposits and withdrawals on behalf of or for the insurer. The administrator may not pay any claim by withdrawals from the fiduciary account. Withdrawals from the account may be made, as provided in the written agreement between the administrator and the insurer, for (1) remittance to an insurer entitled thereto; (2) deposit in an account maintained in the name of the insurer; (3) transfer to and deposit in a claims-paying account with claims to be paid as provided in Section 38-51-100; (4) payment to a group policyholder for remittance to the insurer entitled thereto; (5) payment to the administrator of its commission, fees, or charges; or (6) remittance of return premiums to the person entitled thereto.
HISTORY: Former 1976 Code Section 38-51-90 [1947 (45) 322; 1952 Code Section 37-235; 1955 (49) 329; 1956 (49) 1841; 1962 Code Section 37-235; 1964 (53) 2290; 1986 Act No. 540, Part II, Section 31 M] recodified as Section 38-43-80 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-67-70 [1985 Act No. 133, Section 6] recodified as Section 38-51-90 by 1987 Act No. 155, Section 1.