Utah Code 31A-2-308. Enforcement penalties and procedures
Current as of: 2024 | Check for updates
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Other versions
(1)
For details, see Utah Code § 76-3-204
Attorney's Note
Under the Utah Code, punishments for crimes depend on the classification. In the case of this section:| Class | Prison | Fine |
|---|---|---|
| class B misdemeanor | up to 6 months | up to $1,000 |
Terms Used In Utah Code 31A-2-308
- Administrator: means the same as that term is defined in Subsection (187). See Utah Code 31A-1-301
- 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.
- Certificate: means evidence of insurance given to:(23)(a) an insured under a group insurance policy; or(23)(b) a third party. See Utah Code 31A-1-301
- Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
- consultant: means a person who:
(99)(a) advises another person about insurance needs and coverages;(99)(b) is compensated by the person advised on a basis not directly related to the insurance placed; and(99)(c) except as provided in Section31A-23a-501 , is not compensated directly or indirectly by an insurer or producer for advice given. See Utah Code 31A-1-301- 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.
- Corporation: means an insurance corporation, except when referring to:
(34)(a)(i) a corporation doing business:(34)(a)(i)(A) as:(34)(a)(i)(A)(I) an insurance producer;(34)(a)(i)(A)(II) a surplus lines producer;(34)(a)(i)(A)(III) a limited line producer;(34)(a)(i)(A)(IV) a consultant;(34)(a)(i)(A)(V) a managing general agent;(34)(a)(i)(A)(VI) a reinsurance intermediary;(34)(a)(i)(A)(VII) a third party administrator; or(34)(a)(i)(A)(VIII) an adjuster; and(34)(a)(i)(B) under:(34)(a)(i)(B)(I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and Reinsurance Intermediaries;(34)(a)(i)(B)(II) Chapter 25, Third Party Administrators; or(34)(a)(i)(B)(III) Chapter 26, Insurance Adjusters; or(34)(a)(ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance Holding Companies. See Utah Code 31A-1-301- Department: means the Insurance Department. See Utah Code 31A-1-301
- Domestic insurer: means an insurer organized under the laws of this state. See Utah Code 31A-1-301
- Filing: when used as a noun, means an item required to be filed with the department including:
(70)(a) a policy;(70)(b) a rate;(70)(c) a form;(70)(d) a document;(70)(e) a plan;(70)(f) a manual;(70)(g) an application;(70)(h) a report;(70)(i) a certificate;(70)(j) an endorsement;(70)(k) an actuarial certification;(70)(l) a licensee annual statement;(70)(m) a licensee renewal application;(70)(n) an advertisement;(70)(o) a binder; or(70)(p) an outline of coverage. See Utah Code 31A-1-301- Individual: means a natural person. See Utah Code 31A-1-301
- Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
- Insurance: includes :
(96)(b)(i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;(96)(b)(ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and(96)(b)(iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- License: includes a certificate of authority issued to an insurer. See Utah Code 31A-1-301
- Order: means an order of the commissioner. See Utah Code 31A-1-301
- Person: includes :
(146)(a) an individual;(146)(b) a partnership;(146)(c) a corporation;(146)(d) an incorporated or unincorporated association;(146)(e) a joint stock company;(146)(f) a trust;(146)(g) a limited liability company;(146)(h) a reciprocal;(146)(i) a syndicate; or(146)(j) another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301- Probation: A sentencing alternative to imprisonment in which the court releases convicted defendants under supervision as long as certain conditions are observed.
- producer: means a person licensed or required to be licensed under the laws of this state to sell, solicit, or negotiate insurance. See Utah Code 31A-1-301
- Property: includes both real and personal property. See Utah Code 68-3-12.5
- Rate: means :
(163)(a)(i) the cost of a given unit of insurance; or(163)(a)(ii) for property or casualty insurance, that cost of insurance per exposure unit either expressed as:(163)(a)(ii)(A) a single number; or(163)(a)(ii)(B) a pure premium rate, adjusted before the application of individual risk variations based on loss or expense considerations to account for the treatment of:(163)(a)(ii)(B)(I) expenses;(163)(a)(ii)(B)(II) profit; and(163)(a)(ii)(B)(III) individual insurer variation in loss experience. See Utah Code 31A-1-301- Reinsurance: means an insurance transaction where an insurer, for consideration, transfers any portion of the risk it has assumed to another insurer. See Utah Code 31A-1-301
- State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
- Statute: A law passed by a legislature.
- Surplus: means the excess of assets over the sum of paid-in capital and liabilities. See Utah Code 31A-1-301
- United States: includes each state, district, and territory of the United States of America. See Utah Code 68-3-12.5
(1)(a) A person who violates any insurance statute or rule or any order issued under Subsection31A-2-201 (4) shall forfeit to the state up to twice the amount of any profit gained from the violation, in addition to any other forfeiture or penalty imposed.(1)(b)(1)(b)(i) The commissioner may order an individual producer, surplus line producer, limited line producer, managing general agent, reinsurance intermediary, adjuster, third party administrator, navigator, or insurance consultant who violates an insurance statute or rule to forfeit to the state not more than $2,500 for each violation.(1)(b)(ii) The commissioner may order any other person who violates an insurance statute or rule to forfeit to the state not more than $5,000 for each violation.(1)(c)(1)(c)(i) The commissioner may order an individual producer, surplus line producer, limited line producer, managing general agent, reinsurance intermediary, adjuster, third party administrator, navigator, or insurance consultant who violates an order issued under Subsection31A-2-201 (4) to forfeit to the state not more than $2,500 for each violation. Each day the violation continues is a separate violation.(1)(c)(ii) The commissioner may order any other person who violates an order issued under Subsection31A-2-201 (4) to forfeit to the state not more than $5,000 for each violation. Each day the violation continues is a separate violation.(1)(d) The commissioner may accept or compromise any forfeiture.(2) When a person fails to comply with an order issued under Subsection31A-2-201 (4), including a forfeiture order, the commissioner may file an action in any court of competent jurisdiction or obtain a court order or judgment:(2)(a) enforcing the commissioner’s order;(2)(b)(2)(b)(i) directing compliance with the commissioner’s order and restraining further violation of the order; and(2)(b)(ii) subjecting the person ordered to the procedures and sanctions available to the court for punishing contempt if the failure to comply continues; or(2)(c) imposing a forfeiture in an amount the court considers just, up to $10,000 for each day the failure to comply continues after the filing of the complaint until judgment is rendered.(3)(3)(a) The Utah Rules of Civil Procedure govern actions brought under Subsection (2), except that the commissioner may file a complaint seeking a court-ordered forfeiture under Subsection (2)(c) no sooner than two weeks after giving written notice of the commissioner’s intention to proceed under Subsection (2)(c).(3)(b) The commissioner’s order issued under Subsection31A-2-201 (4) may contain a notice of intention to seek a court-ordered forfeiture if the commissioner’s order is disobeyed.(4) If, after a court order is issued under Subsection (2), the person fails to comply with the commissioner’s order or judgment:(4)(a) the commissioner may certify the fact of the failure to the court by affidavit; and(4)(b) the court may, after a hearing following at least five days written notice to the parties subject to the order or judgment, amend the order or judgment to add the forfeiture or forfeitures, as prescribed in Subsection (2)(c), until the person complies.(5)(5)(a) The proceeds of the forfeitures under this section, including collection expenses, shall be paid into the General Fund.(5)(b) The expenses of collection shall be credited to the department‘s budget.(5)(c) The attorney general’s budget shall be credited to the extent the department reimburses the attorney general’s office for its collection expenses under this section.(6)(6)(a) Forfeitures and judgments under this section bear interest at the rate charged by the United States Internal Revenue Service for past due taxes on the:(6)(a)(i) date of entry of the commissioner’s order under Subsection (1); or(6)(a)(ii) date of judgment under Subsection (2).(6)(b) Interest accrues from the later of the dates described in Subsection (6)(a) until the forfeiture and accrued interest are fully paid.(7) A forfeiture may not be imposed under Subsection (2)(c) if:(7)(a) at the time the forfeiture action is commenced, the person was in compliance with the commissioner’s order; or(7)(b) the violation of the order occurred during the order’s suspension.(8) The commissioner may seek an injunction as an alternative to issuing an order under Subsection31A-2-201 (4).(9)(9)(a) A person is guilty of a class B misdemeanor if that person:(9)(a)(i) intentionally violates:(9)(a)(i)(A) an insurance statute of this state; or(9)(a)(i)(B) an order issued under Subsection31A-2-201 (4);(9)(a)(ii) intentionally permits a person over whom that person has authority to violate:(9)(a)(ii)(A) an insurance statute of this state; or(9)(a)(ii)(B) an order issued under Subsection31A-2-201 (4); or(9)(a)(iii) intentionally aids any person in violating:(9)(a)(iii)(A) an insurance statute of this state; or(9)(a)(iii)(B) an order issued under Subsection31A-2-201 (4).(9)(b) Unless a specific criminal penalty is provided elsewhere in this title, the person may be fined not more than:(9)(b)(i) $10,000 if a corporation; or(9)(b)(ii) $5,000 if a person other than a corporation.(9)(c) If the person is an individual, the person may, in addition, be imprisoned for up to one year.(9)(d) As used in this Subsection (9), “intentionally” has the same meaning as under Subsection76-2-103 (1).(10)(10)(a) A person who knowingly and intentionally violates Section31A-4-102 ,31A-8a-208 ,31A-15-105 ,31A-23a-116 , or31A-31-111 is guilty of a felony as provided in this Subsection (10).(10)(b) When the value of the property, money, or other things obtained or sought to be obtained in violation of Subsection (10)(a):(10)(b)(i) is less than $5,000, a person is guilty of a third degree felony; or(10)(b)(ii) is or exceeds $5,000, a person is guilty of a second degree felony.(11)(11)(a) After a hearing, the commissioner may, in whole or in part, revoke, suspend, place on probation, limit, or refuse to renew the licensee’s license or certificate of authority:(11)(a)(i) when a licensee of the department, other than a domestic insurer:(11)(a)(i)(A) persistently or substantially violates the insurance law; or(11)(a)(i)(B) violates an order of the commissioner under Subsection31A-2-201 (4);(11)(a)(ii) if there are grounds for delinquency proceedings against the licensee under Section31A-27a-207 ; or(11)(a)(iii) if the licensee’s methods and practices in the conduct of the licensee’s business endanger, or the licensee’s financial resources are inadequate to safeguard, the legitimate interests of the licensee’s customers and the public.(11)(b) Additional license termination or probation provisions for licensees other than insurers are set forth in Sections31A-19a-303 ,31A-19a-304 ,31A-23a-111 ,31A-23a-112 ,31A-25-208 ,31A-25-209 ,31A-26-213 ,31A-26-214 ,31A-35-501 , and31A-35-503 .(12) The enforcement penalties and procedures set forth in this section are not exclusive, but are cumulative of other rights and remedies the commissioner has pursuant to applicable law.