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COMMITTEE REPORT
May 4, 2005
H. 3672
S. Printed 5/4/05--H.
Read the first time March 1, 2005.
To whom was referred a Bill (H. 3672) to amend Section 38-43-110, as amended, Code of Laws of South Carolina, 1976, relating to the duration of a producer's license and the lapsing, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, Section 38-43-110(B), SECTION 1, page 1, line 35, by deleting / six twelve / and inserting / six /.
When amended subsection (B) reads:
/ (B) A producer who allows his license to lapse for failure fails to comply with pay the continuing education recordkeeping fee as required by Section 38-43-106 may shall have his license canceled on renewal. However, within six months from the compliance deadline, he may reinstate the same license without the necessity of complying with Section 38-43-105, provided a total of thirty hours of continuing education has been completed by November first of the compliance year, and a penalty fee set forth by regulation is paid the recordkeeping fee is paid to the Continuing Education Administrator. In addition, a penalty fee, not to exceed one hundred dollars, must be paid to and retained by the department for administrative services resulting from those producers who fail to comply with Section 38-43-106. /
Amend further Section 38-43-110(C), SECTION 1, page 2, line 5, by deleting /licensed/ and inserting / license /.
When amended subsection (C) reads:
(C) A producer who fails to comply with the biennial continuing education hourly requirement as provided for in Section 38-43-106 shall have his license canceled on renewal. However, the producer may reinstate the same license without the necessity of complying with Section 38-43-105, provided within six months from the compliance deadline the required number of continuing education hours have been completed and a penalty fee, not to exceed two hundred dollars, is paid to and retained by the department for administrative services resulting from those producers who fail to comply with Section 38-43-106. /
Amend further by adding an appropriately numbered SECTION to read:
/ SECTION __. Section 7B of Act 291 of 2004 is amended to read:
"B. This section takes effect May 1, 2006 2010." /
Renumber sections to conform.
Amend title to conform.
HARRY F. CATO for Committee.
EXPLANATION OF IMPACT:
The Department of Insurance states that this bill would require a first year other funds expenditure totaling $38,100 which would be funded from fees established in the bill. The licensing of Insurance Producers is conducted on a biennial basis. Therefore, additional costs would occur every other year. Approximately 65,000 producers would be affected upon implementation of this bill.
The department estimates that manpower necessary to perform the tasks related to notification of producers that are not in compliance could be achieved by hiring a temporary employee at a cost of $10,000. Notification of these individuals concerning their non-compliance would be done in January of the renewal year at a projected cost of $24,600 and would cover postage, paper, supplies, printing, envelopes and materials. The department also anticipates a subsequent mail out in April of the renewal year costing $3,500 and targeting an estimated 7,500 producers who may still not be in compliance. A one-time cost of $10,000 would be incurred for computer programming to compile information on producers who were not in compliance.
SPECIAL NOTES:
The costs associated with these activities are expected to decrease over time as the level of compliance increases.
The Board of Economic Advisors is the appropriate entity to address any impact associated with this bill.
Approved By:
Don Addy
Office of State Budget
TO AMEND SECTION 38-43-110, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE DURATION OF A PRODUCER'S LICENSE AND THE LAPSING OF A LICENSE ON RENEWAL FOR NONPAYMENT OF A FEE, SO AS TO CHANGE THE PROCEDURE FOR REINSTATING A LICENSE FOR NONPAYMENT OF A FEE OR FAILURE TO COMPLY WITH THE CONTINUING EDUCATION REQUIREMENT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 38-43-110 of the 1976 Code, as last amended by Act 323 of 2002, is further amended to read:
"Section 38-43-110. (A) A producer's license is for an indefinite term unless revoked or suspended as long as the requirements of Section 38-43-106 are met. If the biennial appointment fee for a producer is not paid at the time and in the manner the department provides by regulation, the appointment must be canceled.
(B) A producer who allows his license to lapse for failure fails to comply with pay the continuing education recordkeeping fee as required by Section 38-43-106 may shall have his license canceled on renewal. However, within six twelve months from the compliance deadline, he may reinstate the same license without the necessity of complying with Section 38-43-105, provided a total of thirty hours of continuing education has been completed by November first of the compliance year, and a penalty fee set forth by regulation is paid the recordkeeping fee is paid to the Continuing Education Administrator. In addition, a penalty fee, not to exceed one hundred dollars, must be paid to and retained by the department for administrative services resulting from those producers who fail to comply with Section 38-43-106.
(C) A producer who fails to comply with the biennial continuing education hourly requirement as provided for in Section 38-43-106 shall have his licensed canceled on renewal. However, the producer may reinstate the same license without the necessity of complying with Section 38-43-105, provided within six months from the compliance deadline the required number of continuing education hours have been completed and a penalty fee, not to exceed two hundred dollars, is paid to and retained by the department for administrative services resulting from those producers who fail to comply with Section 38-43-106.
(D) A licensed insurance producer who is unable to comply with license renewal procedures due to active military service or some other extenuating circumstance (e.g., such as a long-term medical disability), may request a waiver of those procedures. The producer may also may request a waiver of any examination requirement or any other fine or sanction imposed for failure to comply with renewal procedures."
SECTION 2. This act takes effect upon approval by the Governor.
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