2005 North Carolina Code - General Statutes § 58-33-95. Agents personally liable; representing unlicensed company prohibited; penalty.

§ 58‑33‑95.  Agents personally liable; representing unlicensed company prohibited; penalty.

(a)       Any person or entity who solicits, negotiates, or sells insurance in this State for an unauthorized insurer:

(1)       Is the representative of that insurer and shall be strictly liable for any losses or unpaid claims if an unauthorized insurer fails to pay in full or in part any claim or loss within the provisions of any insurance contract sold, directly or indirectly, by or through that person or entity on behalf of the unauthorized insurer.

(2)       Shall be guilty of a Class 1 misdemeanor if the person or entity does not know that the insurer is an unauthorized insurer. Each solicitation, negotiation, or sale shall constitute a separate offense.

(3)       Shall be guilty of a Class H felony if the person or entity knew or should have known that the insurer is an unauthorized insurer. Each solicitation, negotiation, or sale shall constitute a separate offense.

(b)       A civil action may be filed or a license revocation proceeding may be initiated under this section regardless of whether a criminal action is brought or a criminal conviction is obtained for the act alleged in the civil action or revocation proceeding.

(c)       As used in this section, the terms "negotiate", "sell", and "solicit" shall have the meanings set forth in G.S. 58‑33‑10. As used in this section, the status of an entity or person as an "unauthorized insurer" shall be determined in accordance with Article 28 of this Chapter and, if applicable, Article 49 of this Chapter. (1987, c. 629, s. 1; 1993, c. 539, s. 457; 1994, Ex. Sess., c. 24, s. 14(c); 2004‑166, s. 1.)