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H. B. No. 35 As IntroducedAs Introduced
127th General Assembly | Regular Session | 2007-2008 |
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Cosponsors: Representatives McGregor, J., Gibbs, Raussen
A BILL
To amend sections 3901.17 and 3905.36 of the Revised Code to decrease from 5% to 1.4% the foreign insurers tax rate.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 3901.17 and 3905.36 of the Revised Code be amended to read as follows:
Sec. 3901.17. (A) As used in this section: (1) "Captive insurer" has the meaning defined in section 3905.36 of the Revised Code. (2) "Insurer" includes, but is not limited to, any person
that is an affiliate of or affiliated with the insurer, as
defined in division (A) of section 3901.32 of the Revised Code,
and any person that is a subsidiary of the insurer as defined in
division (F) of section 3901.32 of the Revised Code. (3) "Laws of this state relating to insurance" has the
meaning defined in division (A)(1) of section 3901.04 of the
Revised Code. (4) "Person" has the meaning defined in division (A) of
section 3901.19 of the Revised Code. (B) Any of the following acts in this state, effected by
mail or otherwise, by any foreign or alien insurer not authorized
to transact business within this state, any nonresident person
acting on behalf of an insurer, or any nonresident insurance
agent subjects the insurer, person, or agent to the exercise of
personal jurisdiction over the insurer, person, or agent to the
extent permitted by the constitutions of this state and of the
United States: (1) Issuing or delivering contracts of insurance to
residents of this state or to corporations authorized to do
business therein; (2) Making or proposing to make any insurance contracts; (3) Soliciting, taking, or receiving any application for
insurance; (4) Receiving or collecting any premium, commission,
membership fee, assessment, dues, or other consideration for any
insurance contract or any part thereof; (5) Disseminating information as to coverage or rates,
forwarding applications, inspecting risks, fixing rates,
investigating or adjusting claims or losses, or transacting any
matters subsequent to effecting a contract of insurance and
arising out of it; (6) Doing any kind of business recognized as constituting
the doing of an insurance business under Title XXXIX of the
Revised Code or subject to regulation by the superintendent of
insurance under the laws of this state relating to insurance. Any such act shall be considered to be the doing of an
insurance business in this state by such insurer, person, or
agent and shall be its agreement that service of any lawful
subpoena, notice, order, or process is of the same legal force
and validity as personal service of the subpoena, notice,
order,
or process in this state upon the insurer, person, or
agent. (C) Service of process in judicial proceedings shall be as
provided by the Rules of Civil Procedure. Service in or out of
this state of notice, orders, or subpoenas in administrative
proceedings before the superintendent shall be as
provided in section 3901.04 of the Revised Code. (D) Service of any notice, order, subpoena, or process in
any such action, suit, or proceeding shall, in addition to the
manner provided in division (C) of this section, be valid if
served upon any person within this state who, in this state on
behalf of such insurer, person, or agent is or has been: (1) Soliciting, procuring, effecting, or negotiating for
insurance; (2) Making, issuing, or delivering any contract of
insurance; (3) Collecting or receiving any premium, membership fees,
assessment, dues, or other consideration for insurance; (4) Disseminating information as to coverage or rates,
forwarding applications, inspecting risks, fixing rates,
investigating or adjusting claims or losses, or transacting any
matters subsequent to effecting a contract of insurance and
arising out of it. (E) Nothing in this section shall limit or abridge the
right to serve any subpoena, order, process, notice, or demand
upon any insurer, person, or agent in any other manner permitted
by law. (F) Every person investigating or adjusting any loss or
claim under a policy of insurance not excepted under division (I)
of this section and issued by any such insurer and covering a
subject of insurance that was resident, located, or to be
performed in this state at the time of issuance shall immediately
report the policy to the superintendent. (G) Each such insurer that does any of the acts set forth
in division (B) of this section in this state by mail or
otherwise shall be subject to a tax of five per cent on the gross
premiums, membership fees, assessments, dues, and other
considerations received on all contracts of insurance covering
subjects of insurance resident, located, or to be performed
within this state. Such insurer shall annually, on or before
the first day
of July, pay such
tax to the
treasurer of state, as calculated on a form prescribed by
the treasurer of state.
If the tax is not paid when due,
the tax shall be increased by a penalty of twenty-five per
cent.
An interest charge computed as set forth in section 5725.221 of
the Revised Code shall be made on the entire sum of the tax plus
penalty, which interest shall be computed from the date the
tax
is due until it is paid. The treasurer of state
shall determine and
report all claims for penalties and interest accruing under this
section to the attorney general for collection. For purposes of this division, payment is considered
made when it is received by the treasurer of state, irrespective
of any United
States postal service marking
or other stamp or mark indicating the date on which the payment
may have been mailed. (H) No contract of insurance effected in this state by
mail or otherwise by any such insurer is enforceable by
the insurer. (I) This section does not apply to: (1) Insurance obtained pursuant to sections 3905.30 to
3905.36 of the Revised Code; (2) The transaction of reinsurance by insurers; (3) Transactions in this state involving a policy
solicited, written, and delivered outside this state covering
only subjects of insurance not resident, located, or to be
performed in this state at the time of issuance, provided such
transactions are subsequent to the issuance of the policy; (4) Transactions in this state involving a policy of group
life or group accident and sickness insurance solicited, written,
and delivered outside this state; (5) Transactions involving contracts of insurance
independently procured through negotiations occurring entirely
outside this state which are reported to the superintendent and with respect to
which the tax provided by section
3905.36 of the Revised Code is paid; (6) An attorney at law acting on behalf of the attorney's
clients in the adjustment of claims or losses; (7) Except as provided in division (G) of this section, any Any insurance company underwriter issuing contracts of
insurance to employer insureds or contracts
of insurance issued to an employer insured. For purposes of this
section, an "employer insured" is an insured to whom all of the
following apply: (a) The insured procures the insurance of any risk or risks
by use
of the services of a full-time employee acting as an insurance
manager or buyer or the services of a regularly and continuously
qualified insurance consultant. As used in division
(I)(7)(a)
of this section, a "regularly and continuously qualified
insurance consultant" does not include any person licensed under
Chapter 3905. of the
Revised
Code. (b) The insured's aggregate annual premiums for insurance
on all
risks total at least twenty-five thousand dollars; and (c) The insured has at least twenty-five full-time
employees. (8) Ocean marine insurance; (9) Transactions involving policies issued by a captive insurer.
Sec. 3905.36. (A) Except as provided in divisions (B) and (C) of this section, every insured association, company,
corporation, or other person that enters, directly or
indirectly,
into any
agreements with any insurance company, association,
individual,
firm, underwriter, or Lloyd Lloyd's, not authorized to do
business in
this state, whereby the insured shall procure,
continue, or renew
contracts of insurance covering subjects of
insurance resident,
located, or to be performed within this state,
with such
unauthorized insurance company, association, individual,
firm,
underwriter, or Lloyd Lloyd's, for which insurance there is a
gross
premium,
membership fee, assessment, dues, or other consideration
charged
or collected, shall annually, on or before the
thirty-first day
of
January, return
to the superintendent of
insurance a
statement
under oath showing the name and address of
the insured,
name and
address of the insurer, subject of the
insurance,
general
description of the coverage, and amount of
gross premium, fee,
assessment, dues, or other consideration for
such insurance for
the preceding twelve-month period and shall at
the same time pay
to the treasurer of state a tax of five one and four-tenths per cent
of such
gross premium,
fee, assessment, dues, or other
consideration,
after a deduction for return premium, if any, as
calculated on a
form prescribed by the treasurer of state. All
taxes
collected
under this section by the treasurer of
state shall
be paid
into
the general revenue fund. If the tax is not paid
when
due,
the
tax shall be increased by a penalty of twenty-five
per
cent.
An
interest charge computed as set forth
in section
5725.221 of the
Revised Code shall be made on the
entire sum of
the tax plus
penalty, which interest shall be
computed from the
date the tax is
due until it is paid.
For purposes of this
section, payment is
considered made when it is received by the
treasurer of state,
irrespective of any United
States postal
service marking
or other
stamp or mark indicating the date on
which the payment
may have
been mailed. (B) This section does not
apply
to: (1) Transactions in this state involving a policy
solicited,
written, and delivered outside this state covering
only subjects
of insurance not resident, located, or to be
performed in this
state at the time of issuance, provided such
transactions are
subsequent to the issuance of the policy; (2) Attorneys-at-law acting on behalf of their clients in
the adjustment of claims or losses; (3) Transactions involving policies issued by a captive insurer. For this purpose, a "captive insurer" means any of the following:
(a) An insurer owned by one or more individuals or organizations, whose exclusive purpose is to insure risks of one or more of the parent organizations or individual owners and risks of one or more affiliates of the parent organizations or individual owners;
(b) In the case of groups and associations, insurers owned by the group or association whose exclusive purpose is to insure risks of members of the group or association and affiliates of the members;
(c) Other types of insurers, licensed and operated in accordance with the captive insurance laws of their jurisdictions of domicile and operated in a manner so as to self-insure risks of their owners and insureds.
(4) Professional or medical liability insurance procured by a hospital organized under Chapter 3701. of the Revised Code. (C) In transactions that are subject to sections 3905.30 to 3905.35 of the Revised Code, each person licensed under section 3905.30 of the
Revised
Code shall pay to the treasurer
of state, on or before the
thirty-first day of
January of each year, five one and four-tenths per
cent of the
balance of the gross premiums charged for insurance
placed or
procured under the license after a deduction for
return premiums,
as reported on a form prescribed by the
treasurer of state. The
tax shall be collected from the insured
by the surplus line broker
who placed or procured the policy of
insurance at the time the
policy is delivered to the insured.
No license issued under
section 3905.30 of the
Revised
Code shall be renewed until
payment
is made.
If the tax is not paid when due, the tax shall be
increased by a penalty of twenty-five per cent. An interest
charge computed as set forth in section 5725.221 of the Revised
Code shall be made on the entire sum of the tax plus penalty,
which interest shall be computed from the date the tax is due
until it is paid. For purposes of this section,
payment is
considered made
when it is received by the
treasurer of state,
irrespective of any
United
States postal service marking
or other
stamp or mark
indicating the date on which the payment
may have
been mailed.
Section 2. That existing sections 3901.17 and 3905.36 of the Revised Code are hereby repealed.
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