HSB 554 (LSB 5287XD (5) 90)

SENATE/HOUSE FILE _____

BY  (PROPOSED DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES BILL)

A BILL FOR

An Act relating to the insurance commissioner’s authority concerning insurance producers, business entity producers, and preneed sellers.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 505.17, subsection 1, paragraph a, Code 2024, is amended to read as follows:
   a.  Information, records, and documents utilized for the purpose of, or in the course of, investigation, regulation, or examination of an insurance company, or insurance holding company, an individual insurance producer, or a business entity producer received by the division from some other governmental entity which treats such information, records, and documents as confidential, are confidential and shall not be disclosed by the division and are not subject to subpoena. Such information, records, and documents do not constitute a public record under chapter 22.
    Sec. 2.  Section 522B.11, subsection 1, paragraph q, Code 2024, is amended to read as follows:
   q.  Is the subject of an order of the securities administrator of this state or any other state, province, district, or territory, denying, suspending, revoking, or otherwise taking action against a registration as a broker-dealer, agent, investment adviser, or investment adviser representative issued by any of the following:
   (1)  The securities administrator of this state or any other state, province, district, or territory.
   (2)  The federal securities and exchange commission.
   (3)  The financial industry regulatory authority.
    Sec. 3.  Section 523A.807, subsection 3, paragraph a, Code 2024, is amended to read as follows:
   a.  Payment of a civil penalty of not more than one thousand dollars for each violation, but not exceeding an aggregate of ten thousand dollars during any six-month period, except that if the commissioner finds that the person knew or reasonably should have known that the person was in violation of such provisions a section or rules adopted pursuant thereto to a section, the penalty shall be not more than five thousand dollars for each violation, but and not exceeding exceed an aggregate of fifty thousand dollars during any six-month period. The commissioner shall assess the penalty on the employer of an individual and not on the individual, if the commissioner finds that the violations committed by the individual were directed, encouraged, condoned, ignored, or ratified by the individual’s employer. Any civil penalties collected under this subsection shall be deposited as provided in section 505.7.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the insurance commissioner’s authority concerning insurance producers, business entity producers, and preneed sellers.
   Under current law, confidential information includes the information, records, and documents utilized for the investigation, regulation, or examination of an insurance company or insurance holding company. The bill also applies to the confidential information of an individual insurance producer or a business entity producer. Such information, records, and documents are confidential, and shall not be disclosed by the insurance division and are not subject to subpoena.
   Current law permits the commissioner to place on probation, or suspend, revoke, or refuse to issue or renew an insurance producer’s license, or levy a civil penalty, if the insurance producer is the subject of an order of a securities administrator. The bill includes an insurance producer that is the subject of an order of the federal securities and exchange commission or the financial industry regulatory authority.
   The penalty for a violation of Code chapter 523A shall be a civil penalty of not more than $1,000 for each violation, not to exceed an aggregate of $10,000 during any six-month period, except if the commissioner finds that the person knew or reasonably should have known that the person was in violation of specific laws or rules related to cemetery and funeral merchandise, and funeral services, the penalty shall not exceed $5,000 for each violation, or an aggregate of $50,000 during any six-month period.