31 Pa. Code § 37a.21 - Appointments and termination of appointments

(a) To act as a representative of an insurer, an insurance producer shall secure a written appointment from each insurer it represents. The following apply:

(1) An insurer shall make appointments in writing to the insurance producer.

(2) If an insurer enters into a contract with the insurance producer to act as a representative of the insurer, the effective date of the appointment shall be the same as the effective date of the contract.

(3) An insurer's notice of appointment form must contain the following:

(i) The effective date of the appointment.

(ii) The name and address of the appointee.

(iii) The appointee's license number.

(iv) The appointee's national producer number.

(v) The insurer's NAIC number.

(b) An insurer may terminate the appointment of an insurance producer to act as the representative of the insurer in accordance with all of the following requirements:

(1) Terminations shall be in writing and sent to the insurance producer prior to or contemporaneously with notification of termination to the department. If an insurance producer requests termination, the insurance entity shall process these terminations within 30 days.

(2) If an insurer has entered into a contract with the insurance producer to act as its representative, the termination date of the appointment shall be the same as the termination date of the contract.

(3) The termination notice to the insurance producer must contain at least the following:

(i) The name of the insurer for which the insurance producer is being terminated.

(ii) The effective date of termination.

(iii) The name and address of the terminated appointee.

(iv) The national producer number or Pennsylvania license number of the terminated appointee.

(v) The names of the designated licensee or licensees if the terminated appointee is a business entity.

(4) Termination initiated by an appointee shall be acted upon by an insurer within 30 days and confirmed by an insurer in its termination form and reported to the department as required under this subsection.

(5) An insurer shall maintain termination records for 7 years after termination is effective.

(6) When a termination of an appointee is for cause, the insurer shall document its reasons for termination and send the paperwork electronically to the attention of the department's Chief of Enforcement.

(7) If an appointment has been terminated on the records of the department, it may not be revived. The insurer shall issue a new appointment with a new effective date in the standard appointment format.

(8) An insurer shall file a termination of an appointment when the appointee ceases to act as the representative of the insurer.

(c) Appointment and termination activity by an insurer shall be submitted to the department electronically through an approved vendor or authorized service within 30 days of the appointment or termination effective date. On a case-by-case basis, the department will continue to accept paper monthly appointment activity reports for insurance companies who have 50 or fewer transactions per calendar year. The report shall be in a format approved by the department. The report shall be filed within 30 days of the end of the period being reported.

(d) Appointment and termination records required under this section may be maintained in the form of electronic paperless filing systems in accordance with guidelines for record retention developed and distributed by the department.

(e) Nothing in this section may affect the insurance producer's rights under sections 1-6 of the act of September 22, 1978 (P.L. 763, No. 143) (40 P.S. §§ 241-246) regarding the termination of agency contracts.

(f) For purposes of this section, written notifications include written notifications sent electronically if in compliance with the Uniform Electronic Transactions Act (73 P.S. §§ 2260.101-2260.503).

Notes

31 Pa. Code § 37a.21

Adopted by Pennsylvania Bulletin, Vol 54, No. 50. December 14, 2024, effective 2/12/2025