§ 58-28-5. Transacting business without a license prohibited; exceptions.
§ 58‑28‑5. Transacting business without a license prohibited; exceptions.
(a) Except as otherwiseprovided in this section, it is unlawful for any company to enter into acontract of insurance as an insurer or to transact insurance business in thisState as set forth in G.S. 58‑28‑13 without a license issued by theCommissioner. This section does not apply to the following acts ortransactions:
(1) The procuring of apolicy of insurance upon a risk within this State where the applicant is unableto procure coverage in the open market with admitted companies and is otherwisein compliance with Article 21 of this Chapter.
(2) Contracts ofreinsurance; but not including assumption reinsurance transactions, whereby thereinsuring company succeeds to all of the liabilities of and supplants theceding company on the insurance contracts that are the subject of thetransaction, unless prior approval has been obtained from the Commissioner.
(3) Transactions in thisState involving a policy lawfully solicited, written and delivered outside ofthis State covering only subjects of insurance not resident, located orexpressly to be performed in this State at the time of issuance, and whichtransactions are subsequent to the issuance of such policy.
(4) Transactions in thisState involving group life insurance, group annuities, or group, blanket, orfranchise accident and health insurance where the master policy for theinsurance was lawfully issued and delivered in a state in which the company wasauthorized to transact business.
(5) Transactions in thisState involving all policies of insurance issued before July 1, 1967.
(6) The procuring ofcontracts of insurance issued to a nuclear insured. As used in thissubdivision, "nuclear insured" means a public utility procuring insuranceagainst radioactive contamination and other risks of direct physical loss at anuclear electric generating plant.
(7) Insuranceindependently procured, as specified in subsection (b) of this section.
(8) Insurance on vesselsor craft, their cargoes, marine builders' risks, marine protection andindemnity, or other risks commonly insured under marine insurance policies, asdistinguished from inland marine insurance policies.
(9) Transactions in thisState involving commercial aircraft insurance, meaning insurance against (i)loss of or damage resulting from any cause to commercial aircraft and itsequipment, (ii) legal liability of the insured for loss or damage to anotherperson's property resulting from the ownership, maintenance, or use of commercialaircraft, and (iii) loss, damage, or expense incident to a liability claim.
(10) An activity in thisState by or on the sole behalf of a captive insurer that insures solely therisks of the company's parent and affiliated companies.
(b) Any person in thisState may directly procure or directly renew insurance with an eligible surpluslines insurer, as defined in G.S. 58‑21‑10(3), without theinvolvement of an agent, broker, or surplus lines licensee, on a risk locatedor to be performed, in whole or in part, in this State. The person shall,within 30 days after the date the insurance is procured or renewed, file awritten report with the Commissioner on forms prescribed by the Commissioner.The report must contain the name and address of the insured; name and addressof the insurer; the subject of insurance; a general description of thecoverage; the amount of premium currently charged; and any additionalinformation requested by the Commissioner. The report must also contain anaffidavit of the insured that states that the full amount or kind of insurancecannot be obtained from insurers that are licensed to do business in thisState; and that the insured has made a diligent search among the insurers thatare licensed to transact and are actually writing the particular kind and classof insurance in this State. Gross premiums charged for the insurance, less anyreturn premiums, are subject to a tax at the rate of five percent (5%). At thetime of filing the report required by this subsection, the insured shall paythe tax to the Commissioner. The Commissioner has the powers specified in G.S.58‑21‑90 with respect to the tax levied by this subsection.
(c) This section doesnot apply to any surviving nonprofit corporation that results from a mergerbetween the nonprofit corporation established by the North Carolina State BarCouncil pursuant to Chapter 707 of the 1975 Session Laws of North Carolina andanother domestic nonprofit corporation; provided, however, that any suchsurviving corporation shall register with the North Carolina State Bar Councilunder G.S. 84‑23.1. (1967, c. 909, s. 1; 1971, c. 510, s. 3; 1985, c.688, s. 2; 1987, c. 727, ss. 4, 5; c. 864, ss. 47, 70; 1991, c. 644, s. 6;1993, c. 409, s. 26; c. 504, s. 20; 1995, c. 193, s. 30; 1999‑219, s.5.4; 2004‑166, s. 4; 2007‑305, s. 4; 2008‑124, ss. 3.1, 3.2.)