[§431:9J-108] Fiduciary duties of administrator; payment of claims by administrator. (a) The administrator shall hold in a fiduciary capacity all charges, claim payments, or premiums that the administrator collects for or on behalf of an insurer and all return premiums that the administrator receives from the insurer. These funds shall be immediately remitted to the person entitled to them or shall be deposited promptly in a fiduciary account established and maintained by the administrator in a federally insured financial institution.
(b) If charges, claim payments, or premiums deposited in a fiduciary account have been collected for or on behalf of more than one insurer, the administrator shall keep records clearly recording the deposits in and withdrawals from the account for or on behalf of each insurer. The administrator shall keep copies of the records and, upon request of an insurer, shall furnish the insurer with copies of records pertaining to the deposits and withdrawals.
(c) An administrator shall not pay claims by withdrawals from the fiduciary account in which premiums or charges are deposited.
(d) The written agreement shall provide that withdrawals from a fiduciary account shall be made only for:
(1) Remittance to an insurer entitled to remittance;
(2) Deposit in an account maintained in the name of the insurer;
(3) Transfer to and deposit in a claims-paying account, with claims to be paid as provided in subsection (e);
(4) Payment to a group policyholder for remittance to the insurer entitled to remittance;
(5) Payment to the administrator of its commission, fees, or charges; and
(6) Remittance of return premiums to the person entitled to return premiums.
(e) All claims the administrator pays from funds collected for or on behalf of an insurer shall be paid only as authorized by the insurer. [L 2019, c 72, pt of §1]