Haw. Code R. § 16-99-148 - Fidelity bond

Current through February, 2022

(a) The fidelity bond shall be issued by a company currently authorized by the insurance commissioner of Hawaii to issue insurance in this State.

(b) Unless otherwise approved by the commission, the fidelity bond shall:

(1) Name the department of commerce and consumer affairs as the certificate holder;

(2) Provide the department of commerce and consumer affairs with written notification at least thirty calendar days prior to its cancellation or termination;

(3) Provide coverage for condominium hotel operator activity only;

(4) Name the condominium hotel operator registrant only as the insured and exclude any other person, trade name, or business entity as the named insured;

(5) Specify that it is a fidelity bond and whether it is a blanket or name schedule type, and if a name schedule type, lists all persons covered;

(6) Specify an expiration date or that it is continuous;

(7) Specify if the bond contains a deductible provision or a nondeductible provision; and

(8) Provide other information as requested by the commission.

(c) The amount of the deductible shall not exceed the greater of $2,000 or five per cent of the face amount of the fidelity bond. In no case shall the amount of the deductible exceed the maximum deductible amount of $5,000.

(d) When the fidelity bond is a name schedule bond, the condominium hotel operator shall:

(1) Provide a certified statement listing the names of all persons handling or having control of the funds received by the condominium hotel operator; and

(2) Provide any changes in the listing of names submitted pursuant to subsection (d)(1), on an amended certified statement within ten calendar days of the change and an original of the amended fidelity bond policy.

(e) Unless otherwise approved by the commission, the fidelity bond shall not contain a criminal conviction endorsement or rider which requires the prosecution or conviction of the employee as a condition precedent to recovery on the bond.

(f) The commission shall terminate the registration of a condominium hotel operator for failure to maintain a fidelity bond in compliance with section 467-30, HRS, and this chapter.

(g) The fidelity bond shall not be required of an individual owner providing apartments or units for transient lodging; provided that ownership of the apartment or unit is in the individual owner's name and not in an entity's name; and provided further that the owner has no employees. Where the individual owner has an employee, the individual owner shall obtain and maintain a fidelity bond.

Notes

Haw. Code R. § 16-99-148

[Eff and comp 2/25/91; am and comp 5/21/01] (Auth: HRS §§ 467-4, 467-30) (Imp: HRS § 467-30) Am and Comp 12/19/2016