Section 27-1-3-20 - Certificate of authority; issuance; necessity; removal of unqualified officers or directors; violations; civil penalties(a) The commissioner may issue a certificate of authority to any company when it shall have complied with the requirements of the laws of this state so as to entitle it to do business in Indiana. The certificate shall be issued under the seal of the department authorizing and empowering the company to make the kind or kinds of insurance specified in the certificate. No certificate of authority shall be issued until the commissioner has found that: (1) the company has submitted a sound plan of operation; and(2) the general character and experience of the incorporators, directors, and proposed officers is such as to assure reasonable promise of a successful operation, based on the fact that such persons are of known good character and that there is no good reason to believe that they are affiliated, directly or indirectly, through ownership, control, management, reinsurance transactions, or other insurance or business relations with any person or persons known to have been involved in the improper manipulation of assets, accounts, or reinsurance. No certificate of authority shall be denied, however, under subdivision (1) or (2) until notice, hearing, and right of appeal has been given as provided in IC 4-21.5.
(b) Every company possessing a certificate of authority shall notify the commissioner of the election or appointment of every new director or principal officer, within thirty (30) days thereafter. If in the commissioner's opinion such a new principal officer or director does not meet the standards set forth in this section, the commissioner shall request that the company effect the removal of such persons from office. If such removal is not accomplished as promptly as under the circumstances and in the opinion of the commissioner is possible, then upon notice to both the company and such principal officer or director and after notice, hearing, and right of appeal pursuant to IC 4-21.5, and after a finding that such person is incompetent or untrustworthy or of known bad character, the commissioner may order the removal of such person from office and may, unless such removal is promptly accomplished, suspend the company's certificate of authority until there is compliance with such order.(c) No company shall transact any business of insurance or hold itself out as a company in the business of insurance in Indiana until it shall have received a certificate of authority as prescribed in this section.(d) No company shall make, issue, deliver, sell, or advertise any kind or kinds of insurance not specified in the company's certificate of authority.(e) Notwithstanding IC 27-1-2-4, a director or officer of a company who knowingly, intentionally, or recklessly violates subsection (c) or (d) commits a Level 6 felony.(f) The commissioner shall impose a civil penalty of not more than twenty-five thousand dollars ($25,000) on a director or officer of a company that violates subsection (c) or (d). The amount imposed must be proportionate to the costs incurred by the department of insurance, other governmental entities, and the courts in regulating the activity of the director, officer, or company who violates subsection (c) or (d). A civil penalty imposed under this subsection may be enforced in the same manner as a civil judgment.Amended by P.L. 136-2018,SEC. 145, eff. 7/1/2018.Amended by P.L. 158-2013, SEC. 296, eff. 7/1/2014.(Formerly: Acts 1935, c.162, s.27; Acts 1967, c.127, s.1; Acts1975 , P.L. 278, SEC.1.) As amended by P.L. 7-1987, SEC.135; P.L. 67-1998, SEC.1.