Insurance records to be retained for a certain time period.
ENTITLED, An Act to
revise the record retention period for certain insurance licensees and
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
be amended to read as follows:
No managing general agent may place business with an insurer unless there is in
force a written contract between the parties which sets forth the responsibilities of each party and
specifies the division of common or shared responsibilities. The contract shall contain the following
The insurer may terminate the contract for cause upon written notice to the managing
general agent. The insurer may suspend the underwriting authority of the managing
general agent during the pendency of any dispute regarding the cause for termination;
The managing general agent shall render accounts to the insurer detailing all transactions
and remit all funds due under the contract to the insurer on not less than a monthly basis;
All funds collected for the account of an insurer shall be held by the managing general
agent in an escrow account in a bank which is a qualified United States financial
institution as defined in
58-30-139. This account shall be used for all payments on
behalf of the insurer. The managing general agent may retain no more than three months
estimated claims payments and allocated loss adjustment expenses;
Separate records of business written by the managing general agent shall be maintained.
The insurer shall have access and right to copy all accounts and records related to its
business in a form usable by the insurer and the director shall have access to all books,
bank accounts, and records of the managing general agent in a form usable to the
director. Records shall be retained for
or until examined, whichever is
The contract may not be assigned in whole or part by the managing general agent;
Appropriate underwriting guidelines including:
The maximum annual premium volume;
The basis of the rates to be charged;
The types of risks which may be written;
Maximum limits of liability;
Policy cancellation provisions; and
The maximum policy period; and
Timely transmission of electronic claims files.
The insurer may cancel or nonrenew any policy of insurance subject to the applicable laws and
regulations concerning the cancellation and nonrenewal of insurance policies.
be amended by adding thereto a NEW SECTION to read as
Any insurer, nonprofit, surgical, dental or hospital plan, a health maintenance organization, or
any other person required to be licensed or registered under this title shall retain all books and
records that are subject to examination pursuant to chapter 58-3 for a period of not less than five
Signed February 15, 2002.