Except as provided in this section and section 3905 of this title, a purchasing group is exempt from any State law, rule, regulation, or order to the extent that such law, rule, regulation, or order would—
(1) prohibit the establishment of a purchasing group;
(2) make it unlawful for an insurer to provide or offer to provide insurance on a basis providing, to a purchasing group or its members, advantages, based on their loss and expense experience, not afforded to other persons with respect to rates, policy forms, coverages, or other matters;
(3) prohibit a purchasing group or its members from purchasing insurance on the group basis described in paragraph (2) of this subsection;
(4) prohibit a purchasing group from obtaining insurance on a group basis because the group has not been in existence for a minimum period of time or because any member has not belonged to the group for a minimum period of time;
(5) require that a purchasing group must have a minimum number of members, common ownership or affiliation, or a certain legal form;
(6) require that a certain percentage of a purchasing group must obtain insurance on a group basis;
(7) require that any insurance policy issued to a purchasing group or any members of the group be countersigned by an insurance agent or broker residing in that State; or
(8) otherwise discriminate against a purchasing group or any of its members.
The exemptions specified in subsection (a) of this section apply to—
(1) liability insurance provided to—
(A) a purchasing group; or
(B) any person who is a member of a purchasing group; and
(2) the provision of—
(A) liability coverage;
(B) insurance related services; or
(C) management services;
to a purchasing group or member of the group.
A State may require that a person acting, or offering to act, as an agent or broker for a purchasing group obtain a license from that State, except that a State may not impose any qualification or requirement which discriminates against a nonresident agent or broker.
(1) A purchasing group which intends to do business in any State shall furnish notice of such intention to the insurance commissioner of such State. Such notice—
(A) shall identify the State in which such group is domiciled;
(B) shall specify the lines and classifications of liability insurance which the purchasing group intends to purchase;
(C) shall identify the insurance company from which the group intends to purchase insurance and the domicile of such company; and
(D) shall identify the principal place of business of the group.
(2) Such purchasing group shall notify the commissioner of any such State as to any subsequent changes in any of the items provided in such notice.
A purchasing group shall register with and designate the State insurance commissioner of each State in which it does business as its agent solely for the purpose of receiving service of legal documents or process, except that such requirement shall not apply in the case of a purchasing group—
(1) which—
(A) was domiciled before April 1, 1986; and
(B) is domiciled on and after October 27, 1986; 1
in any State of the United States;
(2) which—
(A) before September 25, 1981, purchased insurance from an insurance carrier licensed in any State; and
(B) since September 25, 1981, purchases its insurance from an insurance carrier licensed in any State;
(3) which was a purchasing group under the requirements of this chapter before October 27, 1986; and
(4) as long as such group does not purchase insurance that was not authorized for purposes of an exemption under this chapter as in effect before October 27, 1986.
A purchasing group may not purchase insurance from a risk retention group that is not chartered in a State or from an insurer not admitted in the State in which the purchasing group is located, unless the purchase is effected through a licensed agent or broker acting pursuant to the surplus lines laws and regulations of such State.
Nothing in this chapter shall be construed to affect the authority of any State to make use of any of its powers to enforce the laws of such State with respect to which a purchasing group is not exempt under this chapter.
Nothing in this chapter shall affect the authority of any State to bring an action in any Federal or State court.
(Pub. L. 97–45, §4, Sept. 25, 1981, 95 Stat. 951; Pub. L. 99–563, §§6, 8(b), 12(d), Oct. 27, 1986, 100 Stat. 3174, 3175, 3178.)
Sections: Previous 3805 3806 3807 3809 3810 3901 3902 3903 3904 3905 3906 4001 4002 4003 4011 Next
Last modified: October 26, 2015