22 Guam Code Ann. § 15711
Terms Used In 22 Guam Code Ann. § 15711
- Affidavit: A written statement of facts confirmed by the oath of the party making it, before a notary or officer having authority to administer oaths.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- National Bank: A bank that is subject to the supervision of the Comptroller of the Currency. The Office of the Comptroller of the Currency is a bureau of the U.S. Treasury Department. A national bank can be recognized because it must have "national" or "national association" in its name. Source: OCC
- Oath: A promise to tell the truth.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
CH. 15 BUSINESS OF INSURANCE
(a) Definitions.
(1) In this Section, >person= means an individual or business entity. The term >partnership= or >agency partnership,= as used in this Section, means a general partnership or a registered limited liability partnership.
(2) In this Section, the term >corporation= shall mean a corporation organized under the general corporation laws of Guam, or a Guam domiciled limited liability company organized or existing under Guam=s Limited Liability Company Act having its principle place of business on Guam and having as one (1) of its purposes the authority to act as an insurance agent. The licensing and regulation of a limited liability company shall be subject to the same provisions and requirements of this Article that are applicable to corporations licensed under this Article.
(3) In this Article, >bank= means a national banking association organized and existing under the National Bank Acts (12 U.S.C. § 21, et seq.); a state bank organized and existing under the banking laws of Guam; a Savings Bank organized and existing under the banking laws of Guam; and a bank branch, or a bank operating subsidiary, as defined by Guam or Federal law, that is located and doing business on Guam.
(b) Application for License; to Whom License May be
Issued.
(1) Any person, corporation or bank that desires to become an agent for a local mutual aid association, a local mutual burial association, a government mutual assessment corporation, a government mutual insurance company, a casualty company writing accident and health insurance company, or any other type of insurance carrier licensed to do business on Guam, the agents of which are required to be licensed under this Article, shall submit to the Department an application for a license in the form required by the Department.
22 Guam Code Ann. BUSINESS REGULATIONS
CH. 15 BUSINESS OF INSURANCE
(2) The application must bear a signed endorsement by an officer, or properly authorized representative of the insurance carrier, that the individual applicant or the responsible officer and employee of the bank is qualified to hold that individual, the partnership or the bank out in good faith to the general public as an insurance agent, and that the insurance carrier desires that the applicant act as an insurance agent to represent it on Guam.
(3) The Department shall issue a license to an individual or to a general partnership or corporation engaging in the business of insurance. Nothing contained herein shall be construed to permit any unlicensed employee or agent of any corporation to perform any act of an agent under this Article without obtaining a license.
(4) The Department shall issue a license to a bank if the Department finds that:
(A) the bank satisfies the definition of this Article; (B) at least one (1) officer of the bank and each
individual who will be performing any acts as an agent
for the bank are individually licensed under this
Article;
(C) the bank shall pay gross receipt taxes on the commission, fee income or income it receives; provided, that should there be any law in conflict with this provision, that this Section shall control in so far as it deals with income derived from activities related to the business of insurance; and
(D) the bank will have the ability to pay any sums up to Twenty-five Thousand Dollars ($25,000.00) that it might become legally obligated to pay on account of any claim made against it by a customer and caused by a negligent act, error or omission of the bank, or any person for whose acts the bank is legally liable in the conduct of its business under this Article.
22 Guam Code Ann. BUSINESS REGULATIONS
CH. 15 BUSINESS OF INSURANCE
(c) Banks shall not force or induce any customer into buying, transferring or rolling over any insurance coverage in favor of coverage which the bank will directly or indirectly receive a fee income, commission or income.
(d) Banks may sell insurance and may replace, transfer or rollover coverage if it is in the best interest of the customer to do so. The term >best interest= shall include, but not be limited to: an explanation between the coverage and price of a product the bank is offering versus the coverage the customer currently has in force. Comparing companies financial strength shall not be permitted, or any other activity in violation of this Title. The term >customer= means any person, firm or corporation to whom the bank sells, or attempts to sell, a policy of insurance, or from whom the bank accepts an application for insurance.
(f) That ability shall be proven through:
(1) an errors and omissions policy insuring the bank against errors and omissions in at least the sum of One Hundred Thousand Dollars ($100,000.00) with not more than a Ten Thousand Dollar ($10,000.00) deductible feature, issued by an insurance company licensed to do business on Guam, or if a policy cannot be obtained from a company licensed to do business on Guam, a policy issued by a company not licensed to do business on Guam upon filing an affidavit with the Department stating the inability to obtain coverage;
(2) a bond executed by the bank as principal and a surety company authorized to do business on Guam, as surety, in the principal sum of Twenty-five Thousand Dollars ($25,000.00), payable to the Department for the use and benefit of customers of the bank, conditioned that the bank shall pay any final judgment recovered against it by a customer; or
(3) a deposit with the comptroller of cash or securities, with a fair market value of Twenty-five Thousand Dollars ($25,000.00).
22 Guam Code Ann. BUSINESS REGULATIONS
CH. 15 BUSINESS OF INSURANCE
(g) The comptroller shall accept and receive the deposit and hold it exclusively for the protection of a customer of the bank who recovers a final judgment against the bank. The deposit may be withdrawn only upon filing with the Department satisfactory evidence that the bank has withdrawn from the business of insurance and has no unsecured liabilities outstanding, or that the bank has provided for the protection of its customers by furnishing an errors and omissions policy, or a bond, as provided by this Subsection.
(h) Securities so deposited may be exchanged from time to time for other qualified securities. A binding commitment to issue such a policy or bond, or the tender of applicable securities, is sufficient in connection with an application for license. Nothing in this Subsection permits an unlicensed employee or agent of a bank to perform any act of an agent under this Article without obtaining a license, except that no bank, partnership, corporation or any other legal business entity needs to procure an insurance license to sell credit life, mortgage life or personal accident insurance.
(i) A bank licensed as an agent under this Article must maintain the insurance records of the bank, including all files relating to customer complaints, separate from records relating to the banking transactions of the bank. If at any time a bank that holds an agent=s license does not maintain the qualifications necessary to obtain a license, the license of that bank to act as an agent shall be canceled or denied in accordance with this Article. Each bank licensed as an agent under this Article shall file under oath with its application for license renewal a list of the name and address of each individual who will be acting as an agent on behalf of the bank.
SOURCE: GC § 43259. Repealed by P.L. 13-187:217. Added by P.L.
26-056:6 (Nov. 5, 2001).
2015 NOTE: Subsection designations were altered/added to adhere to the Compiler’s general codification and alpha-numeric schemes pursuant to 1 Guam Code Ann. § 1606.