Legislation

Search OpenLegislation Statutes
This entry was published on 2014-10-03
The selection dates indicate all change milestones for the entire volume, not just the location being viewed. Specifying a milestone date will retrieve the most recent version of the location before that date.
SECTION 2119
Insurance agents, brokers, consultants, life settlement brokers, and title insurance agents; written contract for compensation; excess ch...
Insurance (ISC) CHAPTER 28, ARTICLE 21
§ 2119. Insurance agents, brokers, consultants, life settlement
brokers, and title insurance agents; written contract for compensation;
excess charges prohibited.

(a) (1) No person licensed as an insurance agent, broker or consultant
may receive any fee, commission or thing of value for examining,
appraising, reviewing or evaluating any insurance policy, bond, annuity
or pension or profit-sharing contract, plan or program or for making
recommendations or giving advice with regard to any of the above, unless
such compensation is based upon a written memorandum signed by the party
to be charged and specifying or clearly defining the amount or extent of
such compensation.

(2) A copy of every such memorandum or contract shall be retained by
the licensee for not less than three years after such services have been
fully performed.

(b) (1) No person licensed as an insurance agent, broker or a
consultant may receive any compensation, direct or indirect, as a result
of the sale of insurance or annuities to, or the use of securities or
trusts in connection with pensions for, any person to whom any such
licensee has performed any related consulting service for which he has
received a fee or contracted to receive a fee within the preceding
twelve months unless such compensation is provided for in the memorandum
or contract required pursuant to subsection (a) hereof.

(2) This chapter shall not prohibit the offset, in whole or in part,
of compensation payable under subsection (a) hereof by compensation
otherwise payable to such consultant as agent or broker as a result of
such sale of insurance or annuities or the use of securities or trusts
in connection with pensions, if any such offset is provided for in the
written memorandum or contract required under subsection (a) hereof.

(c) (1) No insurance broker may receive any compensation, other than
commissions deductible from premiums on insurance policies or contracts,
from any insured or prospective insured for or on account of the sale,
solicitation or negotiation of, or other services in connection with,
any contract of insurance made or negotiated in this state or for any
other services on account of such insurance policies or contracts,
including adjustment of claims arising therefrom, unless such
compensation is based upon a written memorandum, signed by the party to
be charged, and specifying or clearly defining the amount or extent of
such compensation.

(2) A copy of every such memorandum shall be retained by the broker
for not less than three years after such services have been fully
performed.

(3) This subsection shall not affect the right of any such broker to
recover from the insured the amount of any premium or premiums for
insurance effectuated by or through such broker.

(4) This subsection shall not affect the requirements of subsection
(a) or (b) hereof, subsection (g) of section two thousand one hundred
one or section two thousand one hundred eight of this article.

(d) No insurance broker shall, in connection with the sale,
solicitation or negotiation, issuance, delivery or transfer in this
state of any contract of insurance made or negotiated in this state,
directly or indirectly charge, or receive from, the insured or
prospective insured therein any greater sum than the rate of premium
fixed therefor by the insurer obligated as such therein, unless such
broker has a right to compensation for services created in the manner
specified in subsection (c) of this section.

(e)(1) No person licensed as a life settlement broker may receive any
compensation for examining, appraising, reviewing or evaluating any life
settlement contract or for making recommendations or giving advice with
regard to such contract; or receive any compensation from any owner or
proposed owner for or on account of the solicitation or negotiation of,
or other services in connection with, any life settlement contract
subject to this chapter or for any other services on account of such
contract; unless such compensation is based upon a written memorandum
signed by the party to be charged and specifying or clearly defining the
amount or extent of such compensation. A copy of every such memorandum
shall be retained by the licensee for not less than three years after
such services have been fully performed.

(2) No person licensed as a life settlement broker may receive any
compensation, direct or indirect, for or on account of the solicitation
or negotiation of, or other services in connection with a life
settlement contract subject to this chapter from any person for whom any
such licensee has performed any related consulting service for which the
licensee has received a fee or contracted to receive a fee within the
preceding twelve months unless such compensation is provided for in the
written memorandum required pursuant to paragraph one of this
subsection.

(3) No person licensed as a life settlement broker may receive any
compensation, direct or indirect, from a life settlement provider or any
other person with respect to any life settlement contract if the life
settlement broker has already received or will receive compensation,
direct or indirect from, or on behalf of, the owner with respect to that
life settlement contract.

(f) No title insurance agent may receive any compensation or fee,
direct or indirect, for or on account of services performed in
connection with the issuance of a title insurance policy, unless such
compensation is: (1) for ancillary services not encompassed in the rate
of premium approved by the superintendent; and (2) based upon a written
memorandum signed by the party to be charged, and specifying or clearly
defining the amount or extent of such compensation to be charged for
each ancillary service as well as the total amount or extent of the
compensation to be charged. A copy of every such memorandum shall be
retained by the licensee for not less than three years after such
services have been fully performed. For purposes of this subsection,
legal services performed by a New York state licensed attorney who is
also engaged as a title insurance agent shall not be considered
ancillary services.