BY REPRESENTATIVES Tucker, Schauer, and Swenson;
also SENATOR Schroeder.
CONCERNING THE AUTHORITY OF THE COMMISSIONER OF INSURANCE
TO IMPOSE CERTAIN REQUIREMENTS ON NONADMITTED INSURERS AS A CONDITION
OF BEING AN APPROVED NONADMITTED INSURER IN THIS STATE, AND, IN
CONNECTION THEREWITH, ADOPTING STANDARDS FOR THE SERVICE OF PROCESS
AND TRUST REQUIREMENTS FOR NONADMITTED INSURERS.
Be it enacted by the General Assembly of the State
of Colorado:
SECTION 1. 105108
(1) (c) (II), Colorado Revised Statutes, is amended to read:
105108. Placement of surplus
line insurance. (1) No broker
shall place any coverage with a nonadmitted insurer unless, at
the time of placement, such nonadmitted insurer is included on
the list of approved nonadmitted insurers prepared by the commissioner
at least annually. Nothing in this section shall require the
commissioner to place or maintain the name of any nonadmitted
insurer on the list. To be placed and remain on said approved
list, such nonadmitted insurer shall:
(c) (II) In the case of a Lloyd's
plan or other similar unincorporated group of individual insurers,
or a combination of both unincorporated and incorporated insurers,
such alien insurer shall have and maintain a trust fund representing
the group's liabilities attributable to business written
in the United States, with a trust
surplus IN AN AMOUNT of not less
than one hundred million dollars, which surplus
TRUST FUND shall be available for the benefit of United States
surplus lines policyholders of any member of the group. THE GROUP
SHALL, IN ADDITION, MAINTAIN IN THE UNITED STATES A TRUST FUND
OR TRUST FUNDS IN AN AMOUNT SATISFACTORY TO THE COMMISSIONER THAT
IS NOT LESS THAN THE AMOUNT REQUIRED BY THE LAW OF THE STATE WHERE
THE TRUST FUND OR TRUST FUNDS ARE LOCATED. 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. The trust funds shall
be maintained in an irrevocable trust account in the United States
in a qualified financial institution and shall consist of cash,
securities, letters of credit, or investments of substantially
the same character and quality as those that are eligible investments
for the capital and statutory reserves of admitted insurers to
write like kinds of insurance in this state, and the trust instrument
representing the surplus portion of the trust deposit shall satisfy
the requirements of the standard trust agreement required for
listing with the national association of insurance commissioners'
international insurers department.
SECTION 2. 105114
(2), Colorado Revised Statutes, is amended to read:
105114. Actions against
insurer service. (2) Service
of legal process against the insurer may be made in any such action
by service upon the commissioner. The commissioner shall forthwith
mail the documents of process served, or a true copy thereof,
to the person designated by the insurer
in the policy DESIGNATED BY THE INSURER
PURSUANT TO RULE OF THE COMMISSIONER for the purpose by prepaid
certified mail with return receipt requested. The insurer shall
have forty days from the date of service upon the commissioner
within which to plead, answer, or otherwise defend the action.
Upon service of process upon the commissioner in accordance with
this provision, the court shall be deemed to have jurisdiction
in personam of the insurer. For each service of process, the
sum of ten dollars shall be paid to the division of insurance
at the time of such service.
SECTION 3. Safety
clause. The general assembly hereby finds, determines, and
declares that this act is necessary for the immediate preservation
of the public peace, health, and safety.
____________________________ ____________________________
Charles E. Berry Tom Norton
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Judith M. Rodrigue Patricia K. Dicks
CHIEF CLERK OF THE HOUSE ASSISTANT SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
_________________________________________
Roy Romer
GOVERNOR OF THE STATE
OF COLORADO