Section 27-72-3 - Licensing requirements(a) No person, wherever located, shall act as a provider or broker with an owner or multiple owners who is a resident of this state, without first having obtained a license from the commissioner. If there is more than one owner on a single policy and the owners are residents of different states, the life settlement contract shall be governed by the law of the state in which the owner having the largest percentage ownership resides or, if the owners hold equal ownership, the state of residence of one owner agreed upon in writing by all owners.(b) Application for a provider, or broker, license shall be made to the commissioner by the applicant on a form prescribed by the commissioner, and the application shall be accompanied by a fee reasonable in an amount established by the commissioner.(c) A life insurance producer who has been duly licensed as a resident insurance producer with a life line of authority in this state or his or her home state for at least one year and is licensed as a nonresident producer in this state shall be deemed to meet the licensing requirements of this section and shall be permitted to operate as a broker.(d) Not later than thirty (30) days from the first day of operating as a broker, the life insurance producer shall notify the commissioner that he or she is acting as a broker on a form prescribed by the commissioner, and shall pay any applicable fee to be determined by the commissioner. Notification shall include an acknowledgement by the life insurance producer that he or she will operate as a broker in accordance with this chapter.(e) The insurer that issued the policy that is the subject of a life settlement contract shall not be responsible for any act or omission of a broker or provider or purchaser arising out of or in connection with the life settlement transaction, unless the insurer receives compensation for the placement of a life settlement contract from the provider or purchaser or broker in connection with the life settlement contract.(f) A person licensed as an attorney, certified public accountant or financial planner accredited by a nationally recognized accreditation agency, who is retained to represent the owner, whose compensation is not paid directly or indirectly by the provider or purchaser, may negotiate life settlement contracts on behalf of the owner without having to obtain a license as a broker.(g) Broker licenses may be renewed on a schedule prescribed by the commissioner and upon payment of the reasonable renewal fee as prescribed by the commissioner. Failure to pay the fee within the terms prescribed shall result in the automatic revocation of the license requiring periodic renewal.(h) The term of a provider license shall be perpetual; provided, that the provider files the annual report and pays the fee as prescribed by the commissioner. Failure to file the annual report or pay the fees on or before the due date shall result in immediate suspension of the license.(i) The applicant shall provide such information as the commissioner may require on forms prepared by the commissioner. The commissioner shall have authority, at any time, to require such applicant to fully disclose the identity of its stockholders (except stockholders owning fewer than ten percent (10%) of the shares of an applicant whose shares are publicly traded), partners, officers and employees, and the commissioner may, in the exercise of the commissioner's sole discretion, refuse to issue such a license in the name of any person if not satisfied that any officer, employee, stockholder or partner thereof who may materially influence the applicant's conduct meets the standards set forth in this chapter.(j) Upon the filing of an application and the payment of the license fee, the commissioner shall make an investigation of each applicant and may issue a license if the commissioner finds that the applicant:(1) If a provider, has provided a detailed plan of operation;(2) Is competent and trustworthy and intends to transact its business in good faith;(3) Has a good business reputation and has had experience, training or education so as to be qualified in the business for which the license is applied;(4) If the provider applicant is a legal entity, is formed or organized pursuant to the laws of this state or is a foreign legal entity authorized to transact business in this state, or provides a certificate of good standing from the state of its domicile; and(5) Has provided to the commissioner an anti-fraud plan that meets the requirements of this chapter and includes:(i) A description of the procedures for detecting and investigating possible fraudulent acts and procedures for resolving material inconsistencies between medical records and insurance applications;(ii) A description of the procedures for reporting fraudulent insurance acts to the commissioner;(iii) A description of the plan for anti-fraud education and training of its underwriters and other personnel; and(iv) A written description or chart outlining the arrangement of the anti-fraud personnel who are responsible for the investigation and reporting of possible fraudulent insurance acts and investigating unresolved material inconsistencies between medical records and insurance applications.(k) The commissioner shall not issue any license to any nonresident applicant, unless a written designation of an agent for service of process is filed and maintained with the commissioner or unless the applicant has filed with the commissioner the applicant's written irrevocable consent that any action against the applicant may be commenced against the applicant by service of process on the commissioner.(l) Each licensee shall file with the commissioner on or before the first day of March of each year an annual statement containing such information as the commissioner by rule may prescribe. The department may have this annual statement renewed and analyzed by outside consultant(s) and the total cost of that review shall be borne by, billed directly to and paid by the provider filing the annual statement.(m) A provider may not use any person to perform the functions of a broker as defined in this chapter unless the person holds a current, valid license as a broker, and as provided in this section.(n) A broker may not use any person to perform the functions of a provider as defined in this chapter unless such person holds a current, valid license as a provider, and as provided in this section.(o) A provider, or broker shall provide to the commissioner new or revised information about officers, ten percent (10%) or more stockholders, partners, directors, members or designated employees within thirty (30) days of the change.(p) An individual licensed as a broker shall complete, on a biennial basis, fifteen (15) hours of training related to life settlements and life settlement transactions, as required by the commissioner; provided, however, that a life insurance producer who is operating as a broker pursuant to this section shall not be subject to the requirements of this subsection. Any person failing to meet the requirements of this subsection shall be subject to the penalties imposed by the commissioner. P.L. 2009, ch. 195, § 1; P.L. 2009, ch. 262, § 1.