CHAPTER 4. UNAUTHORIZED INSURERS PROCESS ACT
IC 27-4-4
Chapter 4. Unauthorized Insurers Process Act
IC 27-4-4-1
Purpose; legislative declaration
Sec. 1. (a) The purpose of this chapter is to subject certain
insurers to the jurisdiction of courts of this state in suits by or on
behalf of the insureds or beneficiaries under insurance contracts.
(b) The general assembly declares that it is a subject of concern
that many residents of this state hold policies of insurance issued or
delivered in this state by insurers while not authorized to do business
in this state, thus presenting to such residents the often insuperable
obstacle of resorting to distant forums for the purpose of asserting
legal rights under such policies. In furtherance of such state interest,
the general assembly provides in this chapter a method of substituted
service of process upon such insurers and declares that in so doing
it exercises its power to protect its residents and to define, for the
purpose of this chapter, what constitutes doing business in this state,
and also exercises powers and privileges available to the state by
virtue of 15 U.S.C. 1011 et seq., which declares that the business of
insurance and every person engaged therein shall be subject to the
laws of the several states.
(Formerly: Acts 1955, c.203, s.1.) As amended by P.L.252-1985,
SEC.159.
IC 27-4-4-2
Definitions
Sec. 2. As used in this chapter and unless a different meaning
appears from the context:
(a) The term "insurer" means a company, firm, partnership,
association, order, society, or system making any kind or kinds of
insurance and shall include associations operating as Lloyds,
reciprocal, or interinsurers, or individual underwriters.
(b) The term "unauthorized foreign insurer" means an insurer
organized under the laws of, or whose place of domicile is in any
state of the United States other than this state or organized under the
laws of, or whose place of domicile is in any territory or insular
possession of the United States or the District of Columbia, and
which insurer is not admitted, authorized, and licensed in accordance
with the laws of this state to do and transact the business of insurance
in the state of Indiana.
(c) The term "unauthorized alien insurer" means an insurer
organized under the laws of, or whose place of domicile is in any
country other than the United States or territory or insular possession
thereof, or the District of Columbia, and which insurer is not
admitted, authorized, and licensed in accordance with the laws of this
state to do and transact the business of insurance in the state of
Indiana.
(Formerly: Acts 1955, c.203, s.2.) As amended by P.L.252-1985,
SEC.160.
IC 27-4-4-3
Acts constituting appointment of commissioner as attorney for
service of process; methods of service
Sec. 3. (a) Any of the following acts in this state, effected by mail,
or otherwise, by an unauthorized foreign or alien insurer; (1) the
issuance or delivery of contracts of insurance to residents of this state
or to corporations authorized to do business therein, (2) the
solicitation of applications for such contracts, (3) the collection of
premiums, membership fees, assessments or other considerations for
such contracts, or (4) any other transaction of insurance business, is
equivalent to and shall constitute an appointment by such insurer of
the insurance commissioner of the state of Indiana and his successor
or successors in office, to be its true and lawful attorney, upon whom
may be served all lawful process in any action, suit, or proceeding
instituted by or on behalf of an insured or beneficiary arising out of
any such contract of insurance, and any such act shall be
signification of its agreement that such service of process is of the
same legal force and validity as personal service of process in this
state upon such insurer.
(b) Such service of process shall be made by delivering to and
leaving with the insurance commissioner of the state of Indiana, or
in his office, two (2) copies thereof and the payment to him at the
time of such service a fee as required under IC 27-1-3-15. The
insurance commissioner shall forthwith mail by registered mail one
(1) of the copies of such process to the defendant at its last known
principal place of business, and shall keep a record of all process so
served upon him. Such service of process is sufficient, provided
notice of such service and a copy of the process are sent within ten
(10) days thereafter by registered mail by plaintiff or plaintiff's
attorney to the defendant at its last known principal place of
business, and the defendant's receipt, or receipt issued by the post
office with which the letter is registered, showing the name of the
sender of the letter and the name and address of the person to whom
the letter is addressed, and the affidavit of the plaintiff or plaintiff's
attorney showing a compliance herewith are filed with the clerk of
the court in which such action is pending on or before the date the
defendant is required to appear, or within such further time as the
court may allow.
(c) Service of process in any such action, suit or proceeding shall
in addition to the manner provided in subsection (b) of this section
be valid if served upon any person within this state who, in this state
on behalf of such insurer, is (1) soliciting insurance, or (2) making,
issuing, or delivering any contract of insurance, or (3) collecting or
receiving any premium, membership fee, assessment or other
consideration for insurance; and a copy of such process is sent within
ten (10) days thereafter by registered mail by the plaintiff or
plaintiff's attorney to the defendant at the last known principal place
of business of the defendant, and the defendant's receipt, or the
receipt issued by the post office with which the letter is registered,
showing the name of the sender of the letter and the name and
address of the person to whom the letter is addressed, and the
affidavit of the plaintiff or plaintiff's attorney showing a compliance
herewith are filed with the clerk of the court in which such action is
pending on or before the date the defendant is required to appear, or
within such further time as the court may allow.
(d) No plaintiff or complainant shall be entitled to a judgment by
default under this section until the expiration of thirty (30) days from
the date of the filing of the affidavit of compliance.
(e) Nothing in this section shall limit or abridge the right to serve
any process, notice, or demand upon any insurer in any other manner
now or hereafter permitted by law.
(Formerly: Acts 1955, c.203, s.3.) As amended by P.L.130-1994,
SEC.38; P.L.116-1994, SEC.50.
IC 27-4-4-4
Deposit or bond; motion to quash service
Sec. 4. (a) Before any unauthorized foreign or alien insurer shall
file or cause to be filed any pleading in any action, suit, or
proceeding instituted against it, such unauthorized insurer shall:
(1) deposit, with the clerk of the court in which such action,
suit, or proceeding is pending, cash or securities, or file with
such clerk a bond with good and sufficient sureties, to be
approved by the court, in an amount to be fixed by the court
sufficient to secure the payment of any final judgment which
may be rendered in such action; or
(2) procure a certificate of authority to transact the business of
insurance in this state.
(b) The court in any action, suit, or proceeding, in which service
is made in the manner provided in section 3 of this chapter may, in
its discretion, order such postponement as may be necessary to afford
the defendant reasonable opportunity to comply with the provisions
of subsection (a) and to defend such action.
(c) Nothing in subsection (a) is to be construed to prevent an
unauthorized foreign or alien insurer from filing a motion to quash
a writ or to set aside service made in the manner provided in section
3 of this chapter on the ground either:
(1) that such unauthorized insurer has not done any of the acts
enumerated in section 3(a) of this chapter; or
(2) that the person on whom service was made pursuant to
section 3(c) of this chapter was not doing any of the acts therein
enumerated.
(Formerly: Acts 1955, c.203, s.4.) As amended by P.L.252-1985,
SEC.161.
IC 27-4-4-5
Vexatious refusal to pay without reasonable cause; attorney's fees
Sec. 5. In any action against an unauthorized foreign or alien
insurer upon a contract of insurance issued or delivered in this state
to a resident thereof or to a corporation authorized to do business
therein, if the insurer has failed for thirty (30) days after demand
prior to the commencement of the action to make payment in
accordance with the terms of the contract, and it appears to the court
that such refusal was vexatious and without reasonable cause, the
court may allow to the plaintiff a reasonable attorney fee and include
such fee in any judgment that may be rendered in such action. Such
fee shall not exceed twelve and one-half per cent (12 1/2%) of the
amount which the court or jury finds the plaintiff is entitled to
recover against the insurer, but in no event shall such fee be less than
twenty-five dollars ($25.00). Failure of an insurer to defend any such
action shall be deemed prima facie evidence that its failure to make
payment was vexatious and without reasonable cause.
(Formerly: Acts 1955, c.203, s.5.)
IC 27-4-4-6
Exclusions from act
Sec. 6. The provisions of this chapter shall not apply to any
action, suit, or proceeding against any unauthorized insurer arising
out of any contract of:
(1) reinsurance effectuated in accordance with the laws of
Indiana;
(2) aircraft insurance;
(3) insurance on property or operations of railroads engaged in
interstate commerce;
(4) insurance against legal liability arising out of the ownership,
operation or maintenance of any property having a permanent
situs outside of this state; or
(5) insurance against loss of or damage to any property having
a permanent situs outside of this state;
where such contract contains a provision designating the department
or the commissioner or a bona fide resident of the state of Indiana to
be its true and lawful attorney upon whom may be served all lawful
process in any action, suit, or proceeding instituted by or on behalf
of an insured or beneficiary arising out of any such contract.
(Formerly: Acts 1955, c.203, s.6.) As amended by P.L.252-1985,
SEC.162.
IC 27-4-4-7
Construction
Sec. 7. This chapter is declared to be in addition and supplemental
to other laws of the state of Indiana and shall be construed
accordingly.
(Formerly: Acts 1955, c.203, s.7.) As amended by P.L.252-1985,
SEC.163.
IC 27-4-4-8
Short title
Sec. 8. This chapter may be cited as the Unauthorized Insurers
Process Act.
(Formerly: Acts 1955, c.203, s.9.) As amended by P.L.252-1985,
SEC.164.