N.J. Admin. Code § 11:17C-2.5

Current through Register Vol. 56, No. 18, September 16, 2024

Section 11:17C-2.5 - Minimum recordkeeping requirements

(a) Each insurance producer shall maintain accurate books and records reflecting all insurance-related transactions in which the insurance producer or his employees take part in accordance with the standards set forth in this chapter. These records may be maintained by either separate books of record or by one or more consolidated books of record.

1. All books and records shall consist of sequentially numbered pages and shall be maintained in such a manner that they can be produced for examination at any time.

2. Appropriate and required entries shall be made at least once every 30 days.

(b) Each licensee shall maintain a register of all monies received, deposited, disbursed or withdrawn in connection with an insurance transaction, including, but not limited to: premiums; service fees; placement fees; inspection fees; motorclub fees; premium taxes; transfers and disbursements from a trust account; and all transactions concerning, including the balance of, all interest bearing accounts. The minimum information required to be maintained in the register includes the following:

1. The date monies are received, deposited, disbursed or withdrawn;

2. The amount of money received, deposited, disbursed or withdrawn;

3. An itemized record of the allocation of the funds;

4. The name of the insured, insurance producer, insurer or other account to or from whom monies are disbursed or received pursuant to 11:17C-2.4(b);

5. The policy number or binder number;

6. The receipt number, when available; and

7. The method of payment, such as, cash, check, money order or draft, or credit card, charge card, debit card or direct account deduction pursuant to N.J.A.C. 11:1-24.

(c) If the premium amount received or disbursed differs with the amount billed, the insurance producer shall prepare a written record of the discrepancy which shall be maintained with the relevant entry in the register for the period of time required by 11:17C-2.6(a).

(d) For each disbursement, the number of the check shall be recorded in the register.

(e) If the disbursement is a commission payment to the insurance producer or another insurance producer, the disbursement shall be supported by a written record of the following:

1. The name of the insured;

2. The name of the insurer;

3. The policy number; and

4. The net commission, which shall not be greater than the amount of the disbursements recorded in the register.

(f) All entries for receipts and disbursements shall be supported by evidential matter as provided in (b), (d) and (e) above. The evidential matter shall be referenced in the entry so that it may be traced for verification.

(g) Each insurance producer shall prepare and maintain a monthly reconciliation of the trust account.

(h) Each insurance producer shall maintain a file for each client or customer which shall continue to be maintained for a period of at least five years after the termination of coverage. The minimum items required to be maintained in the file shall include the following:

1. A copy of each application for insurance;

2. The name of any other insurance producer not employed by the insurance producer maintaining the record who handled any transaction or part thereof;

3. The insurance premium financing agreement, if any, and the name of the lender;

4. All correspondence received or sent with respect to any insurance or insurance related transaction; and

5. All receipts evidencing payment by credit card, charge card, debit card, or direct account deduction, as permitted pursuant to N.J.A.C. 11:1-24.

N.J. Admin. Code § 11:17C-2.5

Amended by R.1998 d.276, effective 6/1/1998.
See: 29 N.J.R. 3588(a), 30 N.J.R. 2003(a).
Rewrote (b)7 and added a new (h)5.