US Laws, Codes, Statutes & Cases

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 10
                              PRODUCER LICENSING
    41-1024.  REPORTING AND ACCOUNTING FOR PREMIUMS. (1) All fiduciary funds
received or collected by a producer shall be trust funds received by the
producer in a fiduciary capacity, and the producer shall, in the applicable
regular course of business, account for and pay the same to the person
entitled to the funds. The producer shall establish a separate account for
funds belonging to others in order to avoid a commingling of such fiduciary
funds with his own funds. The producer may deposit and commingle in such
separate account all fiduciary funds so long as the amount of such deposit so
held for all other persons is reasonably ascertainable from the records and
accounts of the producer. A producer who duly collects and deposits funds into
a sweep account maintained by or for the benefit of an applicable insurer
shall not be deemed to be in violation of the fiduciary fund account
requirement. The director may promulgate rules relating to accounting for and
handling of fiduciary funds and the fiduciary fund account.
    (2)  Fiduciary funds shall include all funds collected by an insurance
producer from or on behalf of a client or premium finance company that are to
be paid to an insurance company, its agents, or the producer's employer, and
all funds collected by an insurance producer from an insurance company or its
agents that are to be paid to a policyholder or claimant under any contract of
insurance.
    (3)  Any producer who, not being lawfully entitled thereto, diverts or
appropriates to his own use such trust or fiduciary funds or any portion
thereof, whether or not such funds have been separately deposited, shall upon
conviction be guilty of a felony.