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 certaininsurers to the jurisdiction of courts of this state in suits by or onbehalf of the insureds or beneficiaries under insurance contracts.
(b) The general assembly declares that it is a subject of concernthat many residents of this state hold policies of insurance issued ordelivered in this state by insurers while not authorized to do businessin this state, thus presenting to such residents the often insuperableobstacle of resorting to distant forums for the purpose of assertinglegal rights under such policies. In furtherance of such state interest,the general assembly provides in this chapter a method of substitutedservice of process upon such insurers and declares that in so doingit exercises its power to protect its residents and to define, for thepurpose of this chapter, what constitutes doing business in this state,and also exercises powers and privileges available to the state byvirtue of 15 U.S.C. 1011 et seq., which declares that the business ofinsurance and every person engaged therein shall be subject to thelaws 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 meaningappears from the context:
(a) The term "insurer" means a company, firm, partnership,association, order, society, or system making any kind or kinds ofinsurance and shall include associations operating as Lloyds,reciprocal, or interinsurers, or individual underwriters.
(b) The term "unauthorized foreign insurer" means an insurerorganized under the laws of, or whose place of domicile is in anystate of the United States other than this state or organized under thelaws of, or whose place of domicile is in any territory or insularpossession of the United States or the District of Columbia, andwhich insurer is not admitted, authorized, and licensed in accordancewith the laws of this state to do and transact the business of insurancein the state of Indiana.
(c) The term "unauthorized alien insurer" means an insurerorganized under the laws of, or whose place of domicile is in anycountry other than the United States or territory or insular possessionthereof, or the District of Columbia, and which insurer is notadmitted, authorized, and licensed in accordance with the laws of thisstate to do and transact the business of insurance in the state ofIndiana.
(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 forservice 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) theissuance or delivery of contracts of insurance to residents of this stateor to corporations authorized to do business therein, (2) thesolicitation of applications for such contracts, (3) the collection ofpremiums, membership fees, assessments or other considerations forsuch contracts, or (4) any other transaction of insurance business, isequivalent to and shall constitute an appointment by such insurer ofthe insurance commissioner of the state of Indiana and his successoror successors in office, to be its true and lawful attorney, upon whommay be served all lawful process in any action, suit, or proceedinginstituted by or on behalf of an insured or beneficiary arising out ofany such contract of insurance, and any such act shall besignification of its agreement that such service of process is of thesame legal force and validity as personal service of process in thisstate upon such insurer.
(b) Such service of process shall be made by delivering to andleaving with the insurance commissioner of the state of Indiana, orin his office, two (2) copies thereof and the payment to him at thetime of such service a fee as required under IC 27-1-3-15. Theinsurance commissioner shall forthwith mail by registered mail one(1) of the copies of such process to the defendant at its last knownprincipal place of business, and shall keep a record of all process soserved upon him. Such service of process is sufficient, providednotice of such service and a copy of the process are sent within ten(10) days thereafter by registered mail by plaintiff or plaintiff'sattorney to the defendant at its last known principal place ofbusiness, and the defendant's receipt, or receipt issued by the postoffice with which the letter is registered, showing the name of thesender of the letter and the name and address of the person to whomthe letter is addressed, and the affidavit of the plaintiff or plaintiff'sattorney showing a compliance herewith are filed with the clerk ofthe court in which such action is pending on or before the date thedefendant is required to appear, or within such further time as thecourt may allow.
(c) Service of process in any such action, suit or proceeding shallin addition to the manner provided in subsection (b) of this sectionbe valid if served upon any person within this state who, in this stateon behalf of such insurer, is (1) soliciting insurance, or (2) making,issuing, or delivering any contract of insurance, or (3) collecting orreceiving any premium, membership fee, assessment or otherconsideration for insurance; and a copy of such process is sent withinten (10) days thereafter by registered mail by the plaintiff orplaintiff's attorney to the defendant at the last known principal placeof business of the defendant, and the defendant's receipt, or thereceipt 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 theaffidavit of the plaintiff or plaintiff's attorney showing a complianceherewith are filed with the clerk of the court in which such action ispending on or before the date the defendant is required to appear, orwithin such further time as the court may allow.
(d) No plaintiff or complainant shall be entitled to a judgment bydefault under this section until the expiration of thirty (30) days fromthe date of the filing of the affidavit of compliance.
(e) Nothing in this section shall limit or abridge the right to serveany process, notice, or demand upon any insurer in any other mannernow 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 shallfile or cause to be filed any pleading in any action, suit, orproceeding 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 withsuch clerk a bond with good and sufficient sureties, to beapproved by the court, in an amount to be fixed by the courtsufficient to secure the payment of any final judgment whichmay be rendered in such action; or
(2) procure a certificate of authority to transact the business ofinsurance in this state.
(b) The court in any action, suit, or proceeding, in which serviceis made in the manner provided in section 3 of this chapter may, inits discretion, order such postponement as may be necessary to affordthe defendant reasonable opportunity to comply with the provisionsof subsection (a) and to defend such action.
(c) Nothing in subsection (a) is to be construed to prevent anunauthorized foreign or alien insurer from filing a motion to quasha writ or to set aside service made in the manner provided in section3 of this chapter on the ground either:
(1) that such unauthorized insurer has not done any of the actsenumerated in section 3(a) of this chapter; or
(2) that the person on whom service was made pursuant tosection 3(c) of this chapter was not doing any of the acts thereinenumerated.
(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 alieninsurer upon a contract of insurance issued or delivered in this stateto a resident thereof or to a corporation authorized to do businesstherein, if the insurer has failed for thirty (30) days after demand
prior to the commencement of the action to make payment inaccordance with the terms of the contract, and it appears to the courtthat such refusal was vexatious and without reasonable cause, thecourt may allow to the plaintiff a reasonable attorney fee and includesuch fee in any judgment that may be rendered in such action. Suchfee shall not exceed twelve and one-half per cent (12 1/2%) of theamount which the court or jury finds the plaintiff is entitled torecover against the insurer, but in no event shall such fee be less thantwenty-five dollars ($25.00). Failure of an insurer to defend any suchaction shall be deemed prima facie evidence that its failure to makepayment 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 anyaction, suit, or proceeding against any unauthorized insurer arisingout of any contract of:
(1) reinsurance effectuated in accordance with the laws ofIndiana;
(2) aircraft insurance;
(3) insurance on property or operations of railroads engaged ininterstate commerce;
(4) insurance against legal liability arising out of the ownership,operation or maintenance of any property having a permanentsitus outside of this state; or
(5) insurance against loss of or damage to any property havinga permanent situs outside of this state;
where such contract contains a provision designating the departmentor the commissioner or a bona fide resident of the state of Indiana tobe its true and lawful attorney upon whom may be served all lawfulprocess in any action, suit, or proceeding instituted by or on behalfof 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 supplementalto other laws of the state of Indiana and shall be construedaccordingly.
(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 InsurersProcess Act.
(Formerly: Acts 1955, c.203, s.9.) As amended by P.L.252-1985,SEC.164.