Section 3.31.315. Surety bond requirement.

	(a)  In addition to the other requirements under 3 AAC 31.300 - 3 AAC 31.449 and AS 21.96.110 to qualify for issuance or for renewal of a viatical settlement provider license, an applicant or licensee shall have and maintain while licensed an unimpaired bond in a sum of not less than $200,000 aggregate liability.  
	(b)  A bond required under (a) of this section must  
		(1) be continuous in form;  
		(2) remain in force until the director releases the licensee from liability;  
		(3) be without prejudice to any liability accrued before the effective cancellation; however, the bond may be cancelled if the director receives at least 60 days notice before the date of the effective cancellation; and  
		(4) be in favor of insureds, viators, and the state.  
	(c)  A bond issued under this section must be acceptable to the director and may only be issued  
		(1) by an admitted insurer authorized to transact surety insurance in the state; or  
		(2) in compliance with AS 21.34,  by a surplus lines insurer that is listed on the most recent list of eligible surplus lines insurers published by the director.  
	(d)  An individual who has entered into an employment contract with the firm is not required to have and maintain a bond required under this section if the firm has and maintains a bond or other alternative allowed under (f) of this section.  
	(e)  A firm licensee's bond required under this section extends to all the firm's separate places of business.  
	(f)  If the director determines that a deposit of cash, certificate of deposit, or letter of credit meets the requirements of this section, the deposit of cash, certificate of deposit, or letter of credit may be used instead of a bond.  
	(g)  A firm may enter into an employment contract with a licensed individual to conduct business under the supervision of and in the name of the firm. The individual and the firm shall retain a copy of the contract and shall reply in writing within three working days to an inquiry of the director regarding any business transacted by the individual and the firm.  
	(h)  A licensed individual may, if authorized by the firm, accept on the firm's behalf, a viatical settlement transaction in accordance with a written agency employment contract.  
	(i)  The firm shall be responsible for the actions of an individual transacting viatical settlement transactions under the firm's employment contracts. In any disciplinary proceeding under AS 21,  the existence of the employment contract shall be prima facie evidence that the firm knew of the activities of the individual.  
	(j)  The individual and the firm shall maintain a current list of all of their respective contracts that identifies, for each contract, the parties to the contract, the parties' mailing addresses, electronic mailing addresses, and telephone numbers, and the parties' license number, and the effective and termination dates of employment.  
	(k)  A licensee shall retain the records of an employment contract and make the records available for examination and inspection by the director, at any business time during the five years immediately following the date of the termination of the employment contract unless the director orders a longer period of retention. If the licensee assumes the business of another licensee or former licensee by merger, purchase, or otherwise, the requirements of 3 AAC 31.425 apply.  

Authorities

21.06.090;21.96.110;01.05.031;21.89.110;44.62.125

Notes

Authority

AS 21.06.090 AS 21.96.110 Editor's note: In 2010 the revisor of statutes, acting under AS 01.05.031, renumbered former AS 21.89.110 as AS 21.96.110. As of Register 196 (January 2011), the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6), to 3 AAC 31.315(a), so that the cross-reference to former AS 21.89.110 now refers to the renumbered statute, AS 21.96.110. In addition, the regulations attorney made a conforming technical revision to the authority citation that follows 3 AAC 31.315, so that the citation to former AS 21.89.110 now refers to the renumbered statute, AS 21.96.110.

History

Eff. 8/25/2002, Register 163; am 10/13/2011, Register 200

References

3.31.315