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General Laws

Section 35. Agents of societies shall be licensed in accordance with the provisions of this section.

(1) The term “insurance agent” as used in this section means any authorized or acknowledged agent of a society who acts as such in the solicitation, negotiation or procurement or making of a life insurance, accident and health insurance or annuity contract, including any corporation which is organized exclusively for the purpose of acting as such insurance agent and which is subject to the provisions of section one hundred and seventy-four of chapter one hundred and seventy-five insofar as said provisions are applicable to a fraternal benefit society, except that the term “insurance agent” shall not include—

(a) Any regular salaried officer, member or employee of a licensed society who devotes substantially all of his services to activities other than the solicitation of fraternal insurance contracts from the public, and who receives for the solicitation of such contracts no commission or other compensation directly dependent upon the amount of business obtained; or

(b) Any agent, representative or member of a fraternal benefit society, who devotes, or intends to devote, less than 50 per cent of the person’s time to the solicitation and procurement of insurance contracts for such society. Any person who in the preceding calendar year has solicited or procured any of the following contracts of insurance on behalf of any society is presumed to have devoted or intended to devote 50 per cent of the person’s time to the solicitation and procurement of insurance contracts:

(1) life insurance contracts that, in the aggregate, exceed $200,000 of coverage for all lives insured for the preceding calendar year;

(2) permanent life insurance contracts offering more than $10,000 of coverage on an individual life;

(3) term life insurance contracts offering more than $50,000 of coverage on an individual life;

(4) insurance contracts other than life that the fraternal benefit society may write that insure the lives of more than 25 individuals;

(5) variable life insurance or variable annuity contracts.

(2) Any person who in the commonwealth acts as insurance agent for a society without having authority so to do by virtue of a license issued and in force pursuant to the provisions of this section shall, except as provided in subsection (1), be guilty of a misdemeanor.

(3) No society doing business in the commonwealth shall pay any commission or other compensation to any person for any services in obtaining in the commonwealth any new contract of life, accident or health insurance, or any new annuity contract, except to a licensed insurance agent of such society, and except an agent exempted under subsection (1)(b) of this section.

(4)(a) The commissioner may issue a license to any person who has paid an annual license fee as determined annually by the commissioner of administration under the provision of section three B of chapter seven and who has complied with the requirements of this section, authorizing such licensee to act as an insurance agent on behalf of any society named in such license which is authorized to do business in the commonwealth.

(b) Before any insurance agent’s license shall be issued there shall be on file in the office of the commissioner the following documents:—

(1) A written application by the prospective licensee in such form or forms and supplements thereto, and containing such information, as the commissioner may prescribe; and

(2) A certificate by the society which is to be named in such license, stating that such society has satisfied itself that the named applicant is trustworthy and competent to act as such insurance agent, and that the society will appoint such applicant to act as its agent if the license applied for is issued by the commissioner. Such certificates shall be executed and acknowledged by an officer or managing agent of such society.

(c) No written or other examination shall be required of any individual seeking to be named as a licensee to represent a society as its agent.

(d) The commissioner may refuse to issue or renew any insurance agent’s license if in his judgment the proposed licensee is not trustworthy and competent to act as such agent, or has given cause for revocation or suspension of such license, or has failed to comply with any prerequisite for the issuance or renewal, as the case may be, of such license.

(e) Every license issued pursuant to this section, and every renewal thereof, shall expire on December thirty-first of the even-numbered calendar year following the calendar year in which such license or renewal license was issued.

(f) If the application for a renewal license shall have been filed with the commissioner on or before December thirty-first of the year in which the existing license is to expire, such applicant named in such existing license may continue to act as insurance agent under such existing license, unless same shall be revoked or suspended, until the issuance by the commissioner of the renewal license, or until the expiration of five days after he shall have refused to renew such license and shall have served written notice of such refusal on the applicant. If the applicant shall, within thirty days after such notice is given, notify the commissioner in writing of his request for a hearing on such refusal, the commissioner shall, within a reasonable time after receipt of such notice, grant such hearing, and he may, in his discretion, reinstate such license.

(g) Any such renewal license of an insurance agent may be issued upon the application of the society named in the existing license. Such application shall be in the form or forms prescribed by the commissioner and shall contain such information as he may require. Such application shall contain a certificate executed by the president, or by a vice president, a secretary, an assistant secretary, or corresponding officer by whatever name known, or by an employee expressly designated and authorized to execute such certificate of a domestic or foreign society or by the United States manager of an alien society, stating that the addresses therein given of the agents of such society for whom renewal licenses are requested therein have been verified in each instance immediately preceding the preparation of the application. Notwithstanding the filing of such application, the commissioner may, after reasonable notice to any such society, require that any or all agents of such society to be named as licensees in renewal licenses shall execute and file separate applications for the renewal of such licenses, as hereinbefore specified, and he may also require that each such application shall be accompanied by the certificate specified in paragraph (b)(2) of subsection (4) of this section.

(5) Every society doing business in the commonwealth shall, upon the termination of the appointment of an insurance agent licensed to represent it in the commonwealth, forthwith file with the commissioner a statement, in such form as he may prescribe, of the facts relative to such termination and the cause thereof. Every statement made pursuant to this section shall be deemed a privileged communication.

(6)(a) The commissioner may revoke or may suspend for such period as he may determine, any insurance agent’s license if, after notice and hearing as specified in this section, he determines that the licensee has—

(1) Violated any provision of, or any obligation imposed by, this section, or has violated any law in the course of his dealings as agent;

(2) Made a material misstatement in the application for such license;

(3) Been guilty of fraudulent or dishonest practices;

(4) Demonstrated his incompetency or untrustworthiness to act as an insurance agent; or

(5) Been guilty of rebating as defined by the laws of the commonwealth applicable to life insurance companies.

(b) The revocation or suspension of any insurance agent’s license shall terminate forthwith the license of such agent. No individual whose license has been revoked shall be entitled to obtain any insurance agent’s license under the provisions of this section for a period of one year after such revocation, or, if such revocation be judicially reviewed, for one year after the final determination thereof affirming the action of the commissioner in revoking such license.

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