113 S2244 ES: Terrorism Risk Insurance Program Reauthorization Act of 2014
U.S. Senate
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.This Act may be cited as the Terrorism Risk Insurance Program Reauthorization Act of 2014
.2.Extension of Terrorism Insurance ProgramSection 108(a) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended by
striking December 31, 2014
and inserting December 31, 2021
.3.Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended
by inserting and beginning on January 1, 2016, shall decrease by 1 percentage point per calendar year until
equal to 80 percent
after 85 percent
.4.Recoupment of Federal share of compensation under the programSection 103(e) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended—(1)in paragraph (6), in the matter preceding subparagraph (A), by striking shall be
and all that follows through subparagraph (E) and inserting “shall be the lesser of—(A)$27,500,000,000, as such amount is adjusted pursuant to this paragraph; and(B)the aggregate amount, for all insurers, of insured losses during such calendar year,provided that beginning in the calendar year that follows the date of enactment of the Terrorism
Risk
Insurance Program Reauthorization Act of 2014, the amount set forth under
subparagraph (A) shall increase by $2,000,000,000 per calendar year until
equal to $37,500,000,000.;(2)in paragraph (7)—(A)in subparagraph (A)—(i)in the matter preceding clause (i), by striking for each of the periods referred to in subparagraphs (A) through (E) of paragraph (6)
; and(ii)in clause (i), by striking for such period
;(B)by striking subparagraph (B) and inserting the following:(B)[Reserved.];(C)in subparagraph (C)—(i)by striking occurring during any of the periods referred to in
any of subparagraphs (A) through (E) of paragraph (6), terrorism loss risk-spreading premiums in an
amount equal to 133 percent
and inserting , terrorism loss risk-spreading premiums in an amount equal to 135.5 percent
; and(ii)by inserting as calculated under subparagraph (A)
after mandatory recoupment amount
; and(D)in subparagraph (E)(i)—(i)in subclause (I)—(I)by striking 2010
and inserting 2017
; and(II)by striking 2012
and inserting 2019
;(ii)in subclause (II)—(I)by striking 2011
and inserting 2018
;(II)by striking 2012
and inserting 2019
; and(III)by striking 2017
and inserting 2024
; and(iii)in subclause (III)—(I)by striking 2012
and inserting 2019
; and(II)by striking 2017
and inserting 2024
.5.The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended—(1)in section 102—(A)in paragraph (3)—(i)by redesignating subparagraphs (A), (B), and (C) as clauses (i), (ii), and (iii), respectively;(ii)in the matter preceding clause (i) (as so redesignated), by striking An entity has
and inserting the following:(A)An entity has; and(iii)by adding at the end the following new subparagraph:(B)An entity, including any affiliate thereof, does not have control
over another entity, if, as of the date of enactment of the Terrorism Risk Insurance
Program Reauthorization Act of 2014, the entity is acting as an
attorney-in-fact, as
defined by the Secretary, for the other entity and such other entity is a
reciprocal insurer, provided that the entity
is not, for reasons other than the attorney-in-fact relationship, defined
as having control
under subparagraph (A).;(B)in paragraph (7)—(i)by striking subparagraphs (A) through (F) and inserting the following:(A)the value of an insurer's direct earned premiums during the immediately preceding calendar
year, multiplied by 20 percent; and; (ii)by redesignating subparagraph (G) as subparagraph (B); and(iii)in subparagraph (B), as so redesignated by clause (ii)—(I)by striking notwithstanding subparagraphs (A) through (F), for the Transition Period or any Program Year
and inserting notwithstanding subparagraph (A), for any calendar year
; and(II)by striking Period or Program Year
and inserting calendar year
;(C)by striking paragraph (11); and(D)by redesignating paragraphs (12) through (16) as paragraphs (11) through (15), respectively; and(2)in section 103—(A)in subsection (c), by striking Program Year
and inserting calendar year
;(B)in subsection (e)—(i)in paragraph (1)—(I)in subparagraph (A), as previously amended by section 3—- (aa)by striking
the Transition Period and each Program Year through Program Year 4 shall be equal to 90 percent,
and during Program Year 5 and each Program Year thereafter
and inserting each calendar year
; - (bb)by striking the comma after
80 percent
; and - (cc)by striking
such Transition Period or such Program Year
and inserting such calendar year
; and (II)in subparagraph (B), by striking exceed
and all that follows through clause (ii) and inserting exceed $100,000,000 with respect to such insured losses occurring in the calendar year.
;(ii)in paragraph (2)(A), by striking the period beginning on the first day of the Transition Period and ending on the last day of
Program Year 1, or during any Program Year thereafter
and inserting a calendar year
; and(iii)in paragraph (3), by striking the period beginning on the first day of the Transition Period and ending on the last day of
Program Year 1, or during any other Program Year
and inserting any calendar year
; and(C)in subsection (g)(2)—(i)by striking the Transition Period or a Program Year
each place that term appears and inserting the calendar year
;(ii)by striking such period
and inserting the calendar year
; and(iii)by striking that period
and inserting the calendar year
.6.Improving the certification process(a)As used in this section—(1)the term act of terrorism
has the same meaning as in section 102(1) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C.
6701
note);(2)the term certification process
means the process by which the Secretary determines whether to certify an act as an act of
terrorism under section 102(1) of the Terrorism Risk Insurance Act of 2002
(15 U.S.C. 6701 note); and(3)the term Secretary
means the Secretary of the Treasury.(b)Not later than 9 months after the date of enactment of this Act, the Secretary shall conduct
and complete a study on the certification process.(c)The study required under subsection (a) shall include an examination and analysis of—(1)the establishment of a reasonable timeline by which the Secretary must make an accurate
determination on whether to certify an act as an act of terrorism;(2)the impact that the length of any timeline proposed to be established under paragraph (1) may have
on the insurance industry, policyholders, consumers, and taxpayers as a
whole;(3)the factors the Secretary would evaluate and monitor during the certification process, including
the ability of the Secretary to obtain the required information regarding
the amount of projected and incurred losses resulting from an act which
the Secretary would need in determining whether to certify the act
as an act of terrorism;(4)the appropriateness, efficiency, and effectiveness of the consultation process required under
section 102(1)(A) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C.
6701 note) and any recommendations on changes to the consultation process;
and(5)the ability of the Secretary to provide guidance and updates to the public regarding any act that
may reasonably be certified as an act of terrorism.(d)Upon completion of the study required under subsection (a), the Secretary shall submit a
report on the results of such study to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on Financial Services of
the House of Representatives.(e)Section 102(1) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended—(1)by
redesignating subparagraph (D) as subparagraph (E); and(2)by inserting after subparagraph (C) the following:(D)Not later than 9 months after the report required under section 6 of the Terrorism Risk Insurance
Program Reauthorization Act of 2014 is submitted to the appropriate
committees of Congress, the Secretary shall issue final rules governing
the certification process, including any timeline applicable to any
certification by the Secretary on whether an act is an act of terrorism
under this paragraph..7.GAO study on upfront premiums(a)Not later than 2 years after the date of enactment of this Act, the Comptroller General of the
United States shall complete a study on the viability and effects of the
Federal
Government assessing and collecting upfront premiums on insurers that
participate in the Terrorism Insurance Program established under the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) (hereafter in
this section referred to as the Program
).(b)The study required under subsection (a) shall examine, but shall not be limited to, the following
issues:(1)How the Federal Government could determine the price of such upfront premiums on insurers that
participate in the Program.(2)How the Federal Government could collect and manage such upfront premiums.(3)How the Federal Government could ensure that such upfront premiums are not spent for purposes other
than claims through the Program.(4)How the assessment and collection of such upfront premiums could affect take-up rates for terrorism
risk coverage in different regions and industries and how it could impact
small businesses and consumers in both metropolitan and non-metropolitan
areas.(5)The effect of collecting such upfront premiums on insurers both large and small.(6)The effect of collecting such upfront premiums on the private market for terrorism risk
reinsurance.(7)The size of any Federal Government subsidy insurers may receive through their participation in the
Program, taking into account the Program’s current post-event recoupment
structure.(c)Upon completion of the study required under subsection (a), the Comptroller General shall submit a
report on the results of such study to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on Financial Services of
the House of Representatives.(d)The study and report required under this section shall be made available to the public in
electronic form and shall be published on the website of the Government
Accountability Office.8.Membership of Board of Governors of the Federal Reserve System(a)The first undesignated paragraph of section 10 of the Federal Reserve Act (12 U.S.C.
241) is amended by inserting after the second sentence the following: In selecting members of the Board, the President shall appoint at least 1 member with demonstrated
primary experience
working in or supervising community banks having less than
$10,000,000,000 in total assets.
.(b)The amendment made by this section shall take effect on the date of enactment of this Act and apply
to
appointments made on and after that effective date, excluding any
nomination pending in the Senate on that date.9.Advisory Committee on Risk-Sharing Mechanisms(a)Finding; rule of construction(1)Congress finds that it is desirable to encourage the growth of nongovernmental, private market
reinsurance capacity for protection against losses arising from acts of
terrorism.(2)Nothing in this Act, any amendment made by this Act, or the Terrorism Risk Insurance Act of 2002
(15 U.S.C. 6701 note) shall prohibit insurers from developing risk-sharing
mechanisms to voluntarily reinsure terrorism losses between and among
themselves.(b)Advisory Committee on Risk-Sharing Mechanisms(1)The Secretary of the Treasury shall establish and appoint an advisory committee to be known as the Advisory Committee on Risk-Sharing Mechanisms
(referred to in this subsection as the Advisory Committee
).(2)The Advisory Committee shall provide advice, recommendations, and encouragement with respect to the
creation and development of the nongovernmental risk-sharing mechanisms
described under subsection (a).(3)The Advisory Committee shall be composed of 9 members who are directors, officers, or other
employees of insurers, reinsurers, or capital market participants that are
participating or that desire to participate in the nongovernmental
risk-sharing mechanisms described under subsection (a), and who are
representative of the affected sectors of the insurance industry,
including commercial property insurance, commercial casualty insurance,
reinsurance, and alternative risk transfer industries.(c)The provisions of this section shall take effect on January 1, 2015.<enum>II</enum><header>National Association of Registered Agents and Brokers</header><section id="idD331709612BF4903B9C438AAE2FE9098" section-type="subsequent-section"><enum>201.</enum><header>Short Title</header><text display-inline="no-display-inline">This title may be cited as the
“<short-title>National Association of Registered Agents and Brokers Reform Act of 2014</short-title>”.</text></section><section id="id774a27d4-e7e8-4b42-9f5b-35de72b29963"><enum>202.</enum><header>Reestablishment of the
National Association of Registered Agents and Brokers</header><subsection id="id15199156-293e-4329-99a1-75ad7a43d967"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subtitle C of title
III of the Gramm-Leach-Bliley Act (<external-xref legal-doc="usc" parsable-cite="usc/15/6751">15 U.S.C. 6751 et seq.</external-xref>) is amended to read
as follows:</text><quoted-block display-inline="no-display-inline" id="idcfc688ae-b96a-4cb1-8e48-c61e5b24a861" style="OLC"><subtitle id="idc2b5ab1e-15d5-482d-8645-28389fc70fdd"><enum>C</enum><header>National Association of
Registered Agents and Brokers</header><section id="id8c7918db-d944-4c45-83c3-220c62e34f88"><enum>321.</enum><header>National Association
of Registered Agents and Brokers</header><subsection id="idd010a0e1-b574-47a8-8f47-9256aec1658e"><enum>(a)</enum><header>Establishment</header><text>There
is established the National Association of Registered Agents and Brokers
(referred to in this subtitle as the <quote>Association</quote>).</text></subsection><subsection id="id7e01b46a-1ca0-4fa6-baaf-1fe0fbd22f95"><enum>(b)</enum><header>Status</header><text>The
Association shall—</text><paragraph id="idc6879435-90c2-4a5c-86cc-f764e8905576"><enum>(1)</enum><text>be a nonprofit
corporation;</text></paragraph><paragraph id="id4d490dd8-f722-4ef7-ba59-a68f0e78b3a2"><enum>(2)</enum><text>not be an agent or
instrumentality of the Federal Government;</text></paragraph><paragraph id="id32FE84A22C984DFA8C4650E39E5B2943"><enum>(3)</enum><text>be an independent
organization that may not be merged with or into any other private or public
entity; and</text></paragraph><paragraph id="id7e9e9664-86f8-49ef-b558-0725405c09c3"><enum>(4)</enum><text>except as otherwise
provided in this subtitle, be subject to, and have all the powers conferred
upon, a nonprofit corporation by the District of Columbia Nonprofit Corporation
Act (D.C. Code, sec. 29–301.01 et seq.) or any successor thereto.</text></paragraph></subsection></section><section id="idb9ab4a74-89a3-4b8d-a1ed-0812daf65f0b"><enum>322.</enum><header>Purpose</header><text display-inline="no-display-inline">The purpose of the Association shall be to
provide a mechanism through which licensing, continuing education, and other
nonresident insurance producer qualification requirements and conditions may be
adopted and applied on a multi-state basis without affecting the laws, rules,
and regulations, and preserving the rights of a State, pertaining to—</text><paragraph id="id3731399a-345e-4161-a0b2-136f91d38f85"><enum>(1)</enum><text>licensing, continuing
education, and other qualification requirements of insurance producers that are
not members of the Association;</text></paragraph><paragraph id="id79d44faa-f459-4ac2-9a23-283a166579f3"><enum>(2)</enum><text>resident or nonresident
insurance producer appointment requirements;</text></paragraph><paragraph id="id08c26389-97f7-4dca-8e4b-f8ad57e1d374"><enum>(3)</enum><text>supervising and
disciplining resident and nonresident insurance producers;</text></paragraph><paragraph id="idc4027eba-ca9f-48fa-90e4-33af6bd33a3a"><enum>(4)</enum><text>establishing licensing
fees for resident and nonresident insurance producers so that there is no loss
of insurance producer licensing revenue to the State; and</text></paragraph><paragraph id="idc8a4493d-a4f0-4b14-a5c2-eab252079686"><enum>(5)</enum><text>prescribing and enforcing
laws and regulations regulating the conduct of resident and nonresident
insurance producers.</text></paragraph></section><section id="id52519795-fddf-4316-bc03-54fd179f9c13"><enum>323.</enum><header>Membership</header><subsection id="ideb73cab1-514a-4a6f-946d-e167f46cc8af"><enum>(a)</enum><header>Eligibility</header><paragraph id="idd32ccdd9-44bf-4182-83a4-a0ea92586001"><enum>(1)</enum><header>In
general</header><text>Any insurance producer licensed in its home State shall,
subject to paragraphs (2) and (4), be eligible to become a member of the
Association.</text></paragraph><paragraph id="id5d0a339e-1900-4f28-8c99-eafb24e028b5"><enum>(2)</enum><header>Ineligibility for
suspension or revocation of license</header><text>Subject to paragraph (3), an
insurance producer is not eligible to become a member of the Association if a
State insurance regulator has suspended or revoked the insurance license of the
insurance producer in that State.</text></paragraph><paragraph id="id20a40d48-0318-41ef-b1b6-ece805638128"><enum>(3)</enum><header>Resumption of
eligibility</header><text>Paragraph (2) shall cease to apply to any insurance
producer if—</text><subparagraph id="idb6518130-5168-4a29-a594-32b8febbd6e0"><enum>(A)</enum><text>the State insurance
regulator reissues or renews the license of the insurance producer in the State
in which the license was suspended or revoked, or otherwise terminates or
vacates the suspension or revocation; or</text></subparagraph><subparagraph id="id62890dc9-64da-4b8a-990e-1d2ffa36735b"><enum>(B)</enum><text>the suspension or
revocation expires or is subsequently overturned by a court of competent
jurisdiction.</text></subparagraph></paragraph><paragraph id="idee110c5d-7841-408e-b47a-5344b4be164a"><enum>(4)</enum><header>Criminal history record
check required</header><subparagraph id="id80327b9f-3cc3-453b-a3b0-2daefa1e97e1"><enum>(A)</enum><header>In
general</header><text>An insurance producer who is an individual shall not be
eligible to become a member of the Association unless the insurance producer
has undergone a criminal history record check that complies with regulations
prescribed by the Attorney General of the United States under subparagraph
(K).</text></subparagraph><subparagraph id="id7e857484-c0a3-42da-90a3-a2fbe016e626"><enum>(B)</enum><header>Criminal history record
check requested by home State</header><text>An insurance producer who is
licensed in a State and who has undergone a criminal history record check
during the 2-year period preceding the date of submission of an application to
become a member of the Association, in compliance with a requirement to undergo
such criminal history record check as a condition for such licensure in the
State, shall be deemed to have undergone a criminal history record check for
purposes of subparagraph (A).</text></subparagraph><subparagraph id="ida9870e70-1e41-4379-8480-81d91f9b3ab5"><enum>(C)</enum><header>Criminal history record
check requested by Association</header><clause id="id01f67203-8ad2-47b5-96b0-3d32311fe8cf"><enum>(i)</enum><header>In
general</header><text>The Association shall, upon request by an insurance
producer licensed in a State, submit fingerprints or other identification
information obtained from
the insurance producer, and a request for a criminal history record check of
the insurance producer, to the Federal Bureau of Investigation.</text></clause><clause id="id7fde5912-8102-4eae-9bf9-4eedb93b0c20"><enum>(ii)</enum><header>Procedures</header><text>The
board of directors of the Association (referred to in this subtitle as the
<quote>Board</quote>) shall prescribe procedures for obtaining and utilizing
fingerprints or other identification information and criminal history record
information, including
the establishment of reasonable fees to defray the expenses of the Association in
connection with the performance of a criminal history
record check and appropriate safeguards for maintaining confidentiality and
security of the information. Any fees charged pursuant to this clause shall be
separate and distinct from those charged by the Attorney General pursuant
to subparagraph (I).</text></clause></subparagraph><subparagraph id="id01df7381-ddda-4a37-9cd8-6d61c9ef05c2"><enum>(D)</enum><header>Form of
request</header><text>A submission under subparagraph (C)(i) shall include such fingerprints or other
identification information as is required by the Attorney General concerning
the person about whom the criminal history record check is requested, and a
statement signed by the person authorizing the Attorney General to provide the
information to the Association and for the Association to receive the
information.</text></subparagraph><subparagraph id="idd8f8e6e1-bdee-454d-bfd8-bc9d887aa89f"><enum>(E)</enum><header>Provision of
information by Attorney General</header><text>Upon receiving a submission under
subparagraph (C)(i) from the Association, the Attorney General shall search all
criminal history records of the Federal Bureau of Investigation, including
records of the Criminal Justice Information Services Division of the Federal
Bureau of Investigation, that the Attorney General determines appropriate for
criminal history records corresponding to the fingerprints or other
identification information
provided under subparagraph (D) and provide all criminal history record
information included in the request to the Association.</text></subparagraph><subparagraph id="id8158f90c-b978-4d13-b32a-ad26c3d10f7b"><enum>(F)</enum><header>Limitation on
permissible uses of information</header><text>Any information provided to the
Association under subparagraph (E) may only—</text><clause id="ida0966e92-764a-406c-8351-1ce40bebb702"><enum>(i)</enum><text>be used for purposes of
determining compliance with membership criteria established by the
Association;</text></clause><clause id="id57a76d5f-e6cf-45e5-94cb-b95d32ddc27d"><enum>(ii)</enum><text>be disclosed to State
insurance regulators, or Federal or State law enforcement agencies, in
conformance with applicable law; or</text></clause><clause id="id19b9e792-8c59-4d1c-87c0-bbcfb811094a"><enum>(iii)</enum><text>be disclosed, upon
request, to the insurance producer to whom the criminal history record
information relates.</text></clause></subparagraph><subparagraph id="id9fad3aea-079c-42cb-948c-9cd599f96c1f"><enum>(G)</enum><header>Penalty for improper
use or disclosure</header><text>Whoever knowingly uses any information provided
under subparagraph (E) for a purpose not authorized in subparagraph (F), or
discloses any such information to anyone not authorized to receive it, shall be
fined not more than $50,000 per violation as determined by a court of competent
jurisdiction.</text></subparagraph><subparagraph id="iddaa5b14f-5ba6-4395-8965-3459d02c4d25"><enum>(H)</enum><header>Reliance on
information</header><text>Neither the Association nor any of its Board members,
officers, or employees shall be liable in any action for using information
provided under subparagraph (E) as permitted under subparagraph (F) in good
faith and in reasonable reliance on its accuracy.</text></subparagraph><subparagraph id="ide8ce9044-aeef-4098-97c8-7aec73b828ef"><enum>(I)</enum><header>Fees</header><text>The
Attorney General may charge a reasonable fee for conducting the search and
providing the information under subparagraph (E), and any such fee shall be
collected and remitted by the Association to the Attorney General.</text></subparagraph><subparagraph id="idd4032274-22d0-4995-9e29-d17e8703de95"><enum>(J)</enum><header>Rule of
construction</header><text>Nothing in this paragraph shall be construed
as—</text><clause id="id7d0117ba-9f00-412f-9c0b-bfcba1446a27"><enum>(i)</enum><text>requiring a State
insurance regulator to perform criminal history record checks under this
section; or</text></clause><clause id="id75ff4ca0-f929-4404-9496-fdda440b6bfb"><enum>(ii)</enum><text>limiting any other
authority that allows access to criminal history records.</text></clause></subparagraph><subparagraph id="id0e6ef9d6-ec95-49fc-83ae-0f74f8cbf70e"><enum>(K)</enum><header>Regulations</header><text>The
Attorney General shall prescribe regulations to carry out this paragraph, which
shall include—</text><clause id="id10369dc9-aef3-40fe-b4fc-b6044d5e4115"><enum>(i)</enum><text>appropriate protections
for ensuring the confidentiality of information provided under subparagraph
(E); and</text></clause><clause id="id92053d27-9e8a-42ce-ab3a-b8e86e01f8a8"><enum>(ii)</enum><text>procedures providing a
reasonable opportunity for an insurance producer to contest the accuracy of
information regarding the insurance producer provided under subparagraph
(E).</text></clause></subparagraph><subparagraph id="id4b026a0a-6bca-4a24-848f-b97f69de95f9"><enum>(L)</enum><header>Ineligibility for
membership</header><clause id="id1d836536-993d-4a6b-93e4-34ccc957367f"><enum>(i)</enum><header>In
general</header><text>The Association may, under reasonably consistently
applied standards, deny membership to an insurance producer on the basis of
criminal history record information provided under subparagraph (E), or where
the insurance producer has been subject to disciplinary action, as described in
paragraph (2).</text></clause><clause id="id19f24ef1-7044-418b-8837-0b0d84866542"><enum>(ii)</enum><header>Rights of applicants
denied membership</header><text>The Association shall notify any insurance
producer who is denied membership on the basis of criminal history record
information provided under subparagraph (E) of the right of the insurance
producer to—</text><subclause id="idfa9a3f93-185b-44d2-9519-c3e6b43ba4a1"><enum>(I)</enum><text>obtain a copy of all
criminal history record information provided to the Association under
subparagraph (E) with respect to the insurance producer; and</text></subclause><subclause id="idfeadbee3-9580-4a0d-b29e-ea74e964371f"><enum>(II)</enum><text>challenge the denial of
membership based on the accuracy and completeness of the information.</text></subclause></clause></subparagraph><subparagraph id="id5F40D61128134DEE9C07BAED17BAAC6A"><enum>(M)</enum><header>Definition</header><text>For
purposes of this paragraph, the term <quote>criminal history record check</quote> means a national background check of criminal history records of the Federal
Bureau of Investigation.</text></subparagraph></paragraph></subsection><subsection id="id5ed0a124-d480-45fb-baf6-0b31fcd690aa"><enum>(b)</enum><header>Authority To establish
membership criteria</header><text>The Association may establish membership
criteria that bear a reasonable relationship to the purposes for which the
Association was established.</text></subsection><subsection id="id88f726e5-e38f-43e4-a122-3e92cf180af0"><enum>(c)</enum><header>Establishment of
classes and categories of membership</header><paragraph id="id3b962953-caea-4686-a544-1deb63cfbf49"><enum>(1)</enum><header>Classes of
membership</header><text>The Association may establish separate classes of
membership, with separate criteria, if the Association reasonably determines
that performance of different duties requires different levels of education,
training, experience, or other qualifications.</text></paragraph><paragraph id="id26b0a3f9-612a-459a-9762-9f8c5a17f5d7"><enum>(2)</enum><header>Business
entities</header><text>The Association shall establish a class of membership
and membership criteria for business entities. A business entity that applies
for membership shall be required to designate an individual Association member
responsible for the compliance of the business entity with Association
standards and the insurance laws, rules, and regulations of any State in which
the business entity seeks to do business on the basis of Association
membership.</text></paragraph><paragraph id="id2a9e2c52-7223-4d3e-9803-75ddb9dc11bf"><enum>(3)</enum><header>Categories</header><subparagraph id="id51effd10-29f5-4b5f-8125-39984f01d4ba"><enum>(A)</enum><header>Separate categories for
insurance producers permitted</header><text>The Association may establish
separate categories of membership for insurance producers and for other persons
or entities within each class, based on the types of licensing categories that
exist under State laws.</text></subparagraph><subparagraph id="idec0cc8d8-ac0a-420e-9ccd-f21385a883b3"><enum>(B)</enum><header>Separate treatment for
depository institutions prohibited</header><text>No special categories of
membership, and no distinct membership criteria, shall be established for
members that are depository institutions or for employees, agents, or
affiliates of depository institutions.</text></subparagraph></paragraph></subsection><subsection id="id6ac45fec-7c27-4b86-a7da-df0c7b763d40"><enum>(d)</enum><header>Membership
criteria</header><paragraph id="id1dd17619-6d9e-4a19-b657-50f732a8b4b3"><enum>(1)</enum><header>In
general</header><text>The Association may establish criteria for membership
which shall include standards for personal qualifications, education, training,
and experience. The Association shall not establish criteria that unfairly
limit the ability of a small insurance producer to become a member of the
Association, including imposing discriminatory membership fees.</text></paragraph><paragraph id="idff1a05d3-0d62-4fd5-b502-3f20887382d2"><enum>(2)</enum><header>Qualifications</header><text>In
establishing criteria under paragraph (1), the Association shall not adopt any
qualification less protective to the public than that contained in the National
Association of Insurance Commissioners (referred to in this subtitle as the
<quote>NAIC</quote>) Producer Licensing Model Act in effect as of the date of
enactment of the National Association of Registered Agents and Brokers Reform
Act of 2014, and shall consider the highest levels of insurance producer
qualifications established under the licensing laws of the States.</text></paragraph><paragraph id="idb5ee5e57-d4dd-4521-928e-7658bbee5ed2"><enum>(3)</enum><header>Assistance from
States</header><subparagraph id="id0a598b62-4df4-44e9-9cd4-534f9e081676"><enum>(A)</enum><header>In
general</header><text>The Association may request a State to provide assistance
in investigating and evaluating the eligibility of a prospective member for
membership in the Association.</text></subparagraph><subparagraph id="id9D745AB476384AC5BAAF58C4EFE8970E"><enum>(B)</enum><header>Authorization of
information sharing</header><text>A submission under subsection (a)(4)(C)(i)
made by an insurance producer licensed in a State shall include a statement
signed by the person about whom the assistance is requested authorizing—</text><clause id="id70F362A95CB84419B8FDF1EB50F9DE56"><enum>(i)</enum><text>the State to share
information with the Association; and</text></clause><clause id="id07CF0113A52D4FBBA99C2BBB04482C94"><enum>(ii)</enum><text>the Association to
receive the information.</text></clause></subparagraph><subparagraph id="id7b2c63e3-7a39-407a-8176-af217a765ed8"><enum>(C)</enum><header>Rule of
construction</header><text>Subparagraph (A) shall not be construed as requiring
or authorizing any State to adopt new or additional requirements concerning the
licensing or evaluation of insurance producers.</text></subparagraph></paragraph><paragraph id="idbdfd9595-bd54-409c-8958-6655f2eecad9"><enum>(4)</enum><header>Denial of
membership</header><text>The Association may, based on reasonably consistently
applied standards, deny membership to any State-licensed insurance producer for
failure to meet the membership criteria established by the Association.</text></paragraph></subsection><subsection id="id3e567acd-4eb0-40b1-9a4e-900e5d5e32b3"><enum>(e)</enum><header>Effect of
membership</header><paragraph id="id00ce4d23-6a9d-483b-8185-f8a5e5f3dbb0"><enum>(1)</enum><header>Authority of
association members</header><text>Membership in the Association shall—</text><subparagraph id="id101cafbd-cf83-4627-979c-a833d8e7212a"><enum>(A)</enum><text>authorize an insurance
producer to sell, solicit, or negotiate insurance in any State for which the
member pays the licensing fee set by the State for any line or lines of
insurance specified in the home State license of the insurance producer, and
exercise all such incidental powers as shall be necessary to carry out such
activities, including claims adjustments and settlement to the extent
permissible under the laws of the State, risk management, employee benefits
advice, retirement planning, and any other insurance-related consulting
activities;</text></subparagraph><subparagraph id="idae454044-3adf-42e6-b5a6-2ee8464c476e"><enum>(B)</enum><text>be the equivalent of a
nonresident insurance producer license for purposes of authorizing the
insurance producer to engage in the activities described in subparagraph (A) in
any State where the member pays the licensing fee; and</text></subparagraph><subparagraph id="id88d9d348-6aae-42d2-bd26-2e3561c53c94"><enum>(C)</enum><text>be the equivalent of a
nonresident insurance producer license for the purpose of subjecting an
insurance producer to all laws, regulations, provisions or other action of any
State concerning revocation, suspension, or other enforcement action related to
the ability of a member to engage in any activity within the scope of authority
granted under this subsection and to all State laws, regulations, provisions,
and actions preserved under paragraph (5).</text></subparagraph></paragraph><paragraph id="id30d892cf-aff7-4034-ac25-6d4f0e8282e1"><enum>(2)</enum><header>Violent Crime Control
and Law Enforcement Act of 1994</header><text>Nothing in this subtitle shall be
construed to alter, modify, or supercede any requirement established by section
1033 of title 18, United States Code.</text></paragraph><paragraph id="id9df45c03-80c9-4356-bb9b-df240a499164"><enum>(3)</enum><header>Agent for remitting
fees</header><text>The Association shall act as an agent for any member for
purposes of remitting licensing fees to any State pursuant to paragraph
(1).</text></paragraph><paragraph id="id7ccc6347-b04e-4022-b91d-e7a6733b76c7"><enum>(4)</enum><header>Notification of
action</header><subparagraph id="ida40edc03-9c3a-4604-aea2-5a6857b0f9bc"><enum>(A)</enum><header>In
general</header><text>The Association shall notify the States (including State
insurance regulators) and the NAIC when an insurance producer has satisfied the
membership criteria of this section. The States (including State insurance
regulators) shall have 10 business days after the date of the notification in
order to provide the Association with evidence that the insurance producer does
not satisfy the criteria for membership in the Association.</text></subparagraph><subparagraph id="id6a736e4a-92ba-4bb1-93b1-2a6501b9bdf2"><enum>(B)</enum><header>Ongoing disclosures
required</header><text>On an ongoing basis, the Association shall disclose to
the States (including State insurance regulators) and the NAIC a list of the
States in which each member is authorized to operate. The Association shall
immediately notify the States (including State insurance regulators) and the
NAIC when a member is newly authorized to operate in one or more States, or is
no longer authorized to operate in one or more States on the basis of
Association membership.</text></subparagraph></paragraph><paragraph id="id10740e7a-37f1-4840-8bbe-bd5dd88ba803"><enum>(5)</enum><header>Preservation of
consumer protection and market conduct regulation</header><subparagraph id="idEF6FD6F343DD4B10AE931139839A2BBB"><enum>(A)</enum><header>In
general</header><text>No provision of this section shall be construed as
altering or affecting the applicability or continuing effectiveness of any law,
regulation, provision, or other action of any State, including those described
in subparagraph (B), to the extent that the State law, regulation, provision,
or other action is not inconsistent with the provisions of this subtitle
related to market entry for nonresident insurance producers, and then only to
the extent of the inconsistency.</text></subparagraph><subparagraph id="id3F6EA461FF7145E19A84CFFDB50F029B"><enum>(B)</enum><header>Preserved
regulations</header><text>The laws, regulations, provisions, or other actions
of any State referred to in subparagraph (A) include laws, regulations,
provisions, or other actions that—</text><clause id="idf5f81c2a-29ad-4635-98c5-5ce1c3cddc3b"><enum>(i)</enum><text>regulate market conduct,
insurance producer conduct, or unfair trade practices;</text></clause><clause id="id8ed94f08-b828-42ae-8c69-4161d1ab32e4"><enum>(ii)</enum><text>establish consumer
protections; or</text></clause><clause id="id83ac2c92-713b-4a43-9ff5-d7c0fd0c22a9"><enum>(iii)</enum><text>require insurance
producers to be appointed by a licensed or authorized insurer.</text></clause></subparagraph></paragraph></subsection><subsection id="idb1339d07-029a-4488-bdb2-b7dad2a34549"><enum>(f)</enum><header>Biennial
renewal</header><text>Membership in the Association shall be renewed on a
biennial basis.</text></subsection><subsection id="id9874bc99-9cd5-4787-bb05-10e7504dc792"><enum>(g)</enum><header>Continuing
education</header><paragraph id="id23fb43db-7aaa-4246-b6cd-b8f18b6f817b"><enum>(1)</enum><header>In
general</header><text>The Association shall establish, as a condition of
membership, continuing education requirements which shall be comparable to the
continuing education requirements under the licensing laws of a majority of the
States.</text></paragraph><paragraph id="id17317033-b399-4477-87c8-bc8511bfba15"><enum>(2)</enum><header>State continuing
education requirements</header><text>A member may not be required to satisfy
continuing education requirements imposed under the laws, regulations,
provisions, or actions of any State other than the home State of the
member.</text></paragraph><paragraph id="id9f35ee8c-6b42-439e-a946-2bbdc0e5ebb1"><enum>(3)</enum><header>Reciprocity</header><text>The
Association shall not require a member to satisfy continuing education
requirements that are equivalent to any continuing education requirements of
the home State of the member that have been satisfied by the member during the
applicable licensing period.</text></paragraph><paragraph id="idb6d9e5d8-af8f-485e-8ca2-a2459b71cdac"><enum>(4)</enum><header>Limitation on the
Association</header><text>The Association shall not directly or indirectly
offer any continuing education courses for insurance producers.</text></paragraph></subsection><subsection id="idc60a6500-2c88-4f8b-bfe4-3c19d845a61c"><enum>(h)</enum><header>Probation, suspension
and revocation</header><paragraph id="id819c77f5-e50d-43aa-bac0-90ca92e23887"><enum>(1)</enum><header>Disciplinary
action</header><text>The Association may place an insurance producer that is a
member of the Association on probation or suspend or revoke the membership of
the insurance producer in the Association, or assess monetary fines or
penalties, as the Association determines to be appropriate, if—</text><subparagraph id="id8dd162d6-ba7e-4d30-8e8e-b7322a125475"><enum>(A)</enum><text>the insurance producer
fails to meet the applicable membership criteria or other standards established
by the Association;</text></subparagraph><subparagraph id="ide3d9838b-c7f1-47be-bab7-ba54f93dcaf5"><enum>(B)</enum><text>the insurance producer
has been subject to disciplinary action pursuant to a final adjudicatory
proceeding under the jurisdiction of a State insurance regulator;</text></subparagraph><subparagraph id="idde413411-f508-41c9-b9a6-f2fff240a230"><enum>(C)</enum><text>an insurance license held
by the insurance producer has been suspended or revoked by a State insurance
regulator; or</text></subparagraph><subparagraph id="id23d03d2b-783c-4386-ac2c-001adef4f8f0"><enum>(D)</enum><text>the insurance producer
has been convicted of a crime that would have resulted in the denial of
membership pursuant to subsection (a)(4)(L)(i) at the time of application, and
the Association has received a copy of the final disposition from a court of
competent jurisdiction.</text></subparagraph></paragraph><paragraph id="id1f0e7eb7-3dd1-4ca7-be6d-48709b41eb24"><enum>(2)</enum><header>Violations of
Association standards</header><text>The Association shall have the power to
investigate alleged violations of Association standards.</text></paragraph><paragraph id="id1a2cdc21-096c-4890-bea5-2b6a03af0edc"><enum>(3)</enum><header>Reporting</header><text>The
Association shall immediately notify the States (including State insurance
regulators) and the NAIC when the membership of an insurance producer has been
placed on probation or has been suspended, revoked, or otherwise terminated, or
when the Association has assessed monetary fines or penalties.</text></paragraph></subsection><subsection id="id5bcd3050-6477-4e14-a312-871d43a7e4f3"><enum>(i)</enum><header>Consumer
complaints</header><paragraph id="idb341a59f-cad7-4f69-b676-26fc5a5868b0"><enum>(1)</enum><header>In
general</header><text>The Association shall—</text><subparagraph id="id8819ffe2-780e-4522-bd44-8a15979880dd"><enum>(A)</enum><text>refer any complaint
against a member of the Association from a consumer relating to alleged
misconduct or violations of State insurance laws to the State insurance
regulator where the consumer resides and, when appropriate, to any additional
State insurance regulator, as determined by standards adopted by the
Association; and</text></subparagraph><subparagraph id="idd236d9c2-b11f-4b5b-a1cc-55dff39830ad"><enum>(B)</enum><text>make any related records
and information available to each State insurance regulator to whom the
complaint is forwarded.</text></subparagraph></paragraph><paragraph id="id8c1f62c1-547b-4c97-ac68-a4f89f5f234e"><enum>(2)</enum><header>Telephone and other
access</header><text>The Association shall maintain a toll-free number for
purposes of this subsection and, as practicable, other alternative means of
communication with consumers, such as an Internet webpage.</text></paragraph><paragraph id="id755dce87-c634-46b1-835c-2930c383f981"><enum>(3)</enum><header>Final disposition of
investigation</header><text>State insurance regulators shall provide the
Association with information regarding the final disposition of a complaint
referred pursuant to paragraph (1)(A), but nothing shall be construed to compel
a State to release confidential investigation reports or other information
protected by State law to the Association.</text></paragraph></subsection><subsection id="id84344c81-3c5a-4045-bb82-20cc4fea6067"><enum>(j)</enum><header>Information
sharing</header><text>The Association may—</text><paragraph id="idB898494277254AE58C90D4812599CCCE"><enum>(1)</enum><text>share documents,
materials, or other information, including confidential and privileged
documents, with a State, Federal, or international governmental entity or with
the NAIC or other appropriate entity referenced in paragraphs (3) and (4),
provided that the recipient has the authority and agrees to maintain the
confidentiality or privileged status of the document, material, or other
information;</text></paragraph><paragraph id="id89304DDB2C6F4EE58A9C0724C9FB40EA"><enum>(2)</enum><text>limit the sharing of
information as required under this subtitle with the NAIC or any other
non-governmental entity, in circumstances under which the Association
determines that the sharing of such information is unnecessary to further the
purposes of this subtitle;</text></paragraph><paragraph id="id119DB988BB774865BEFBDC17FD0CC01C"><enum>(3)</enum><text>establish a central
clearinghouse, or utilize the NAIC or another appropriate entity, as determined
by the Association, as a central clearinghouse, for use by the Association and
the States (including State insurance regulators), through which members of the
Association may disclose their intent to operate in 1 or more States and pay
the licensing fees to the appropriate States; and</text></paragraph><paragraph id="idFD004E3175DB4F3FB0B54E2A954B719E"><enum>(4)</enum><text>establish a database, or
utilize the NAIC or another appropriate entity, as determined by the
Association, as a database, for use by the Association and the States
(including State insurance regulators) for the collection of regulatory
information concerning the activities of insurance producers.</text></paragraph></subsection><subsection id="id6801CA03C8C7474985E6132F9DFA313D"><enum>(k)</enum><header>Effective
Date</header><text>The provisions of this section shall take effect on the
later of—</text><paragraph id="id4E4A1569ABC740599AF79BBDF4DE3567"><enum>(1)</enum><text>the expiration of the
2-year period beginning on the date of enactment of the National Association of
Registered Agents and Brokers Reform Act of 2014; and</text></paragraph><paragraph id="id05B9C99F8195413DBB081C04514E24FA"><enum>(2)</enum><text>the date of incorporation
of the Association.</text></paragraph></subsection></section><section id="id172a8e07-a725-4986-97d3-8234557efab7"><enum>324.</enum><header>Board of
directors</header><subsection id="idb5cfaad3-d6d0-4759-94bc-12bfe0814f34"><enum>(a)</enum><header>Establishment</header><text>There
is established a board of directors of the Association, which shall have
authority to govern and supervise all activities of the Association.</text></subsection><subsection id="id6de05cfd-0de9-4e3a-a662-71e8a52b0d52"><enum>(b)</enum><header>Powers</header><text>The
Board shall have such of the powers and authority of the Association as may be
specified in the bylaws of the Association.</text></subsection><subsection id="id52189605-4eae-4675-b90a-eda223b10970"><enum>(c)</enum><header>Composition</header><paragraph id="idefb09543-2b9b-4582-960f-fd0c6e6de410"><enum>(1)</enum><header>In
general</header><text>The Board shall consist of 13 members who shall be
appointed by the President, by and with the advice and consent of the Senate,
in accordance with the procedures established under Senate Resolution 116 of
the 112th Congress, of whom—</text><subparagraph id="id7d78b995-9fbf-4b75-a3ae-8e6e19b05d2a"><enum>(A)</enum><text>8 shall be State
insurance commissioners appointed in the manner provided in paragraph (2), 1 of
whom shall be designated by the President to serve as the chairperson of the
Board until the Board elects one such State insurance commissioner Board member
to serve as the chairperson of the Board;</text></subparagraph><subparagraph id="id17cd0923-779d-44fa-9399-ed15c6f4d293"><enum>(B)</enum><text>3 shall have demonstrated
expertise and experience with property and casualty insurance producer
licensing; and</text></subparagraph><subparagraph id="id4efe8bdb-843a-4510-ae55-c68a47889d7b"><enum>(C)</enum><text>2 shall have demonstrated
expertise and experience with life or health insurance producer
licensing.</text></subparagraph></paragraph><paragraph id="id1d2ed041-534f-4171-ae38-d363c077466e"><enum>(2)</enum><header>State insurance
regulator representatives</header><subparagraph id="ida85c231a-3f58-4631-8fd7-ceeca2ea3826"><enum>(A)</enum><header>Recommendations</header><text>Before
making any appointments pursuant to paragraph (1)(A), the President shall
request a list of recommended candidates from the States through the NAIC,
which shall not be binding on the President. If the NAIC fails to submit a list
of recommendations not later than 15 business days after the date of the
request, the President may make the requisite appointments without considering
the views of the NAIC.</text></subparagraph><subparagraph id="id567ef1d5-c2f1-40b1-a5ba-7e04783baecd"><enum>(B)</enum><header>Political
affiliation</header><text>Not more than 4 Board members appointed under
paragraph (1)(A) shall belong to the same political party.</text></subparagraph><subparagraph id="id57ea4956-3206-4579-b753-2809cb8d55e5"><enum>(C)</enum><header>Former State insurance
commissioners</header><clause id="idD1D8920AC19C4ABFA5D89F0201DADA6C"><enum>(i)</enum><header>In
general</header><text>If, after offering each currently serving State insurance
commissioner an appointment to the Board, fewer than 8 State insurance
commissioners have accepted appointment to the Board, the President may appoint
the remaining State insurance commissioner Board members, as required under
paragraph (1)(A), of the appropriate political party as required under
subparagraph (B), from among individuals who are former State insurance
commissioners.</text></clause><clause id="id3FA9A342C8CE4D82BFA6FB59C32A85F6"><enum>(ii)</enum><header>Limitation</header><text>A
former State insurance commissioner appointed as described in clause (i) may
not be employed by or have any present direct or indirect financial interest in
any insurer, insurance producer, or other entity in the insurance industry,
other than direct or indirect ownership of, or beneficial interest in, an
insurance policy or annuity contract written or sold by an insurer.</text></clause></subparagraph><subparagraph id="idC4A08C83C95E4AD0833CF06BFFF771FC"><enum>(D)</enum><header>Service through
term</header><text>If a Board member appointed under paragraph (1)(A) ceases to
be a State insurance commissioner during the term of the Board member, the
Board member shall cease to be a Board member.</text></subparagraph></paragraph><paragraph id="idd5fdaea4-569a-4867-a30b-1cceb3bc3c3c"><enum>(3)</enum><header>Private sector
representatives</header><text>In making any appointment pursuant to
subparagraph (B) or (C) of paragraph (1), the President may seek
recommendations for candidates from groups representing the category of
individuals described, which shall not be binding on the President.</text></paragraph><paragraph id="id32c38106-021c-4fb8-a29e-32a70a09431b"><enum>(4)</enum><header>State insurance
commissioner defined</header><text>For purposes of this subsection, the term
<quote>State insurance commissioner</quote> means a person who serves in the
position in State government, or on the board, commission, or other body that
is the primary insurance regulatory authority for the State.</text></paragraph></subsection><subsection id="id50979158-467f-45d4-ad4e-19affd69f39a"><enum>(d)</enum><header>Terms</header><paragraph id="id120d8c97-7ed5-4027-b642-a951f15b2637"><enum>(1)</enum><header>In
general</header><text>Except as provided under paragraph (2), the term of
service for each Board member shall be 2 years.</text></paragraph><paragraph id="idB0755F4F084A4CBE981C3031B30EE52B"><enum>(2)</enum><header>Exceptions</header><subparagraph id="id12655781126546C38517BB2AED86B1CD"><enum>(A)</enum><header>1-year
terms</header><text>The term of service shall be 1 year, as designated by the
President at the time of the nomination of the subject Board members
for—</text><clause id="idf41fbbfb-fdbd-4927-99ee-8ede2be5a844"><enum>(i)</enum><text>4 of the State insurance
commissioner Board members initially appointed under paragraph (1)(A), of whom
not more than 2 shall belong to the same political party;</text></clause><clause id="ida86b0c84-13a8-4ef8-ae71-5e4e4d223ef5"><enum>(ii)</enum><text>1 of the Board members
initially appointed under paragraph (1)(B); and</text></clause><clause id="id29CA7E5CA8BF4D3EBDB98A15ECC52FC0"><enum>(iii)</enum><text>1 of the Board members
initially appointed under paragraph (1)(C).</text></clause></subparagraph><subparagraph id="idEA58C1DFBAC4437BAEA672B26DAF01E0"><enum>(B)</enum><header>Expiration of
Term</header><text>A Board member may continue to serve after the expiration of
the term to which the Board member was appointed for the earlier of 2 years or
until a successor is appointed.</text></subparagraph><subparagraph id="iddda86ee8-2bd6-4c26-8ad8-78beb930a14b"><enum>(C)</enum><header>Mid-term
appointments</header><text>A Board member appointed to fill a vacancy occurring
before the expiration of the term for which the predecessor of the Board member
was appointed shall be appointed only for the remainder of that term.</text></subparagraph></paragraph><paragraph id="idfb7a3399-5130-4655-ad55-60d82d5c2936"><enum>(3)</enum><header>Successive
terms</header><text>Board members may be reappointed to successive
terms.</text></paragraph></subsection><subsection id="id743e59b5-0f39-4e72-be23-7f77b9b426fc"><enum>(e)</enum><header>Initial
appointments</header><text>The appointment of initial Board members shall be
made no later than 90 days after the date of enactment of the
<short-title>National Association of Registered Agents and Brokers Reform Act of 2014</short-title>.</text></subsection><subsection id="id00fc3a99-58af-4ef8-93f8-8b57e976c76b"><enum>(f)</enum><header>Meetings</header><paragraph id="id3de9704c-f8a4-4ded-b203-9031108cdceb"><enum>(1)</enum><header>In
general</header><text>The Board shall meet—</text><subparagraph id="idAFCC3313FAB14C11BB9FE730FF86E557"><enum>(A)</enum><text>at the call of the
chairperson;</text></subparagraph><subparagraph id="id6EF2A724AF4E423F84D9E850F5E4DCF9"><enum>(B)</enum><text>as requested in writing
to the chairperson by not fewer than 5 Board members; or</text></subparagraph><subparagraph id="idEC1A019DD71742FD85342C1399E2A3E9"><enum>(C)</enum><text>as otherwise provided by
the bylaws of the Association.</text></subparagraph></paragraph><paragraph id="id0bf29919-8329-4b52-aacb-fc76b8939754"><enum>(2)</enum><header>Quorum
required</header><text>A majority of all Board members shall constitute a
quorum.</text></paragraph><paragraph id="id846174a9-9e2b-4716-87ff-92eca5a561a4"><enum>(3)</enum><header>Voting</header><text>Decisions
of the Board shall require the approval of a majority of all Board members
present at a meeting, a quorum being present.</text></paragraph><paragraph id="id0769c887-4c57-4290-8721-33dda38b49e5"><enum>(4)</enum><header>Initial
meeting</header><text>The Board shall hold its first meeting not later than 45
days after the date on which all initial Board members have been
appointed.</text></paragraph></subsection><subsection id="ided345153-bb5a-44da-b305-8e1d63f74118"><enum>(g)</enum><header>Restriction on
confidential information</header><text>Board members appointed pursuant to
subparagraphs (B) and (C) of subsection (c)(1) shall not have access to
confidential information received by the Association in connection with
complaints, investigations, or disciplinary proceedings involving insurance
producers.</text></subsection><subsection id="ide3291091-de51-4d31-8b29-dcfb2648870f"><enum>(h)</enum><header>Ethics and conflicts of
interest</header><text>The Board shall issue and enforce an ethical conduct
code to address permissible and prohibited activities of Board members and
Association officers, employees, agents, or consultants. The code shall, at a
minimum, include provisions that prohibit any Board member or Association
officer, employee, agent or consultant from—</text><paragraph id="id4c08ea4b-a0e5-41b2-a84a-119c4bb1a55c"><enum>(1)</enum><text>engaging in unethical
conduct in the course of performing Association duties;</text></paragraph><paragraph id="id532ecdfa-1558-4219-94e9-539c3290c67d"><enum>(2)</enum><text>participating in the
making or influencing the making of any Association decision, the outcome of
which the Board member, officer, employee, agent, or consultant knows or had
reason to know would have a reasonably foreseeable material financial effect,
distinguishable from its effect on the public generally, on the person or a
member of the immediate family of the person;</text></paragraph><paragraph id="id13f080a3-1685-45dc-849e-4fbc9f5e6f3d"><enum>(3)</enum><text>accepting any gift from
any person or entity other than the Association that is given because of the
position held by the person in the Association;</text></paragraph><paragraph id="idb0fb4ed6-2e38-4e7f-9e64-7629872c1e2a"><enum>(4)</enum><text>making political
contributions to any person or entity on behalf of the Association; and</text></paragraph><paragraph id="id2cfb4880-cec9-4778-91db-d7c4bca393fd"><enum>(5)</enum><text>lobbying or paying a
person to lobby on behalf of the Association.</text></paragraph></subsection><subsection id="id644DE83CD48A4F61834432E213AA87BA"><enum>(i)</enum><header>Compensation</header><paragraph id="id860F59A8FEED4E048DC282C29AEB0445"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), no Board member may
receive any compensation from the Association or any other person or entity on
account of Board membership.</text></paragraph><paragraph id="id6685350459214806A180FEB404C42724"><enum>(2)</enum><header>Travel expenses and per
diem</header><text>Board members may be reimbursed only by the Association for
travel expenses, including per diem in lieu of subsistence, at rates consistent
with rates authorized for employees of Federal agencies under subchapter I of
<external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/5/57">chapter 57</external-xref> of title 5, United States Code, while away from home or regular
places of business in performance of services for the Association.</text></paragraph></subsection></section><section id="id3de05fda-d3b2-4d34-92f5-06e24eecdb7b"><enum>325.</enum><header>Bylaws, standards, and
disciplinary actions</header><subsection id="id9017444a-2c30-4e8c-9ac4-a816de62e296"><enum>(a)</enum><header>Adoption and amendment
of bylaws and standards</header><paragraph id="id002cc324-ed64-44cb-9d03-d682b1398cb0"><enum>(1)</enum><header>Procedures</header><text>The
Association shall adopt procedures for the adoption of bylaws and standards
that are similar to procedures under subchapter II of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/5/5">chapter 5</external-xref> of title 5,
United States Code (commonly known as the <quote>Administrative Procedure
Act</quote>).</text></paragraph><paragraph id="id83136A06A5A4405FB0979F196E717D96"><enum>(2)</enum><header>Copy required to be
filed</header><text>The Board shall submit to the President, through the
Department of the Treasury, and the States (including State insurance
regulators), and shall publish on the website of the Association, all proposed
bylaws and standards of the Association, or any proposed amendment to the
bylaws or standards of the Association, accompanied by a concise general
statement of the basis and purpose of such proposal.</text></paragraph><paragraph id="idd54e1cde-e3ba-46e3-bade-9b11a0f86cfc"><enum>(3)</enum><header>Effective
date</header><text>Any proposed bylaw or standard of the Association, and any
proposed amendment to the bylaws or standards of the Association, shall take
effect, after notice under paragraph (2) and opportunity for public comment, on
such date as the Association may designate, unless suspended under section
329(c).</text></paragraph><paragraph id="id0016E0AC880442468D1C56EE1FDDFF0D"><enum>(4)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed to
subject the Board or the Association to the requirements of subchapter II of
<external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/5/5">chapter 5</external-xref> of title 5, United States Code (commonly known as the
<quote>Administrative Procedure Act</quote>).</text></paragraph></subsection><subsection id="id00f9e62a-0032-4a00-923c-c0a8df1e1d6f"><enum>(b)</enum><header>Disciplinary action by
the Association</header><paragraph id="id2567b3fa-400f-4fba-995a-405b410e36b7"><enum>(1)</enum><header>Specification of
charges</header><text>In any proceeding to determine whether membership shall
be denied, suspended, revoked, or not renewed, or to determine whether a member
of the Association should be placed on probation (referred to in this section
as a <quote>disciplinary action</quote>) or whether to assess fines or monetary
penalties, the Association shall bring specific charges, notify the member of
the charges, give the member an opportunity to defend against the charges, and
keep a record.</text></paragraph><paragraph id="idef167f0d-6daf-4015-860e-674d81494dfd"><enum>(2)</enum><header>Supporting
statement</header><text>A determination to take disciplinary action shall be
supported by a statement setting forth—</text><subparagraph id="id7b0cb8d3-9d86-4b54-9dd8-056da51cf1ab"><enum>(A)</enum><text>any act or practice in
which the member has been found to have been engaged;</text></subparagraph><subparagraph id="id45e4d6a1-bcfd-4d3d-b801-8c811b2521b2"><enum>(B)</enum><text>the specific provision of
this subtitle or standard of the Association that any such act or practice is
deemed to violate; and</text></subparagraph><subparagraph id="id52040af0-9a4b-4490-bf2f-a42ebd6c4dd6"><enum>(C)</enum><text>the sanction imposed and
the reason for the sanction.</text></subparagraph></paragraph><paragraph id="ida83ee26f-1600-4f8a-94d9-f6fe493043ea"><enum>(3)</enum><header>Ineligibility of
private sector representatives</header><text>Board members appointed pursuant
to section 324(c)(3) may not—</text><subparagraph id="idB3490B052B7143A689836DF6F150B6D1"><enum>(A)</enum><text>participate in any
disciplinary action or be counted toward establishing a quorum during a
disciplinary action; and</text></subparagraph><subparagraph id="id38129C35BD2E4344894DCB757BA432AC"><enum>(B)</enum><text>have access to
confidential information concerning any disciplinary action.</text></subparagraph></paragraph></subsection></section><section id="ida2d8966f-62e1-4241-aace-409ea6bbade2"><enum>326.</enum><header>Powers</header><text display-inline="no-display-inline">In addition to all the powers conferred upon
a nonprofit corporation by the District of Columbia Nonprofit Corporation Act,
the Association shall have the power to—</text><paragraph id="id43fc47e9-3dc9-4c0c-aefa-4e267ba1fd7e"><enum>(1)</enum><text>establish and collect
such membership fees as the Association finds necessary to impose to cover the
costs of its operations;</text></paragraph><paragraph id="idfa94f707-338d-4746-aa3c-a40a2d2ad344"><enum>(2)</enum><text>adopt, amend, and repeal
bylaws, procedures, or standards governing the conduct of Association business
and performance of its duties;</text></paragraph><paragraph id="ida0a6b685-e7a2-46cf-9c46-5795c5689ac7"><enum>(3)</enum><text>establish procedures for
providing notice and opportunity for comment pursuant to section 325(a);</text></paragraph><paragraph id="idad0aac19-2125-4e85-8ba8-81937774e8d2"><enum>(4)</enum><text>enter into and perform
such agreements as necessary to carry out the duties of the Association;</text></paragraph><paragraph id="idc914c5d0-ace6-4eb3-89f4-a12c2882bc89"><enum>(5)</enum><text>hire employees,
professionals, or specialists, and elect or appoint officers, and to fix their
compensation, define their duties and give them appropriate authority to carry
out the purposes of this subtitle, and determine their qualification;</text></paragraph><paragraph id="id043874D8CFAA4A4C96C600F2FF10F814"><enum>(6)</enum><text>establish personnel
policies of the Association and programs relating to, among other things,
conflicts of interest, rates of compensation, where applicable, and
qualifications of personnel;</text></paragraph><paragraph id="ide3b69690-3d87-483a-84a2-79afb5bddf6c"><enum>(7)</enum><text>borrow money; and</text></paragraph><paragraph id="id2eed0702-29da-42c6-878f-da10524de76a"><enum>(8)</enum><text>secure funding for such
amounts as the Association determines to be necessary and appropriate to
organize and begin operations of the Association, which shall be treated as
loans to be repaid by the Association with interest at market rate.</text></paragraph></section><section id="id16132d8e-9b63-4dad-a62d-32f911b9f24f"><enum>327.</enum><header>Report by the
Association</header><subsection id="idf2854aef-f0df-4aba-8dfa-3983b919109c"><enum>(a)</enum><header>In
general</header><text>As soon as practicable after the close of each fiscal
year, the Association shall submit to the President, through the Department of
the Treasury, and the States (including State insurance regulators), and shall
publish on the website of the Association, a written report regarding the
conduct of its business, and the exercise of the other rights and powers
granted by this subtitle, during such fiscal year.</text></subsection><subsection id="idc1d5b97c-3bbb-4953-b8d5-9a5675610364"><enum>(b)</enum><header>Financial
statements</header><text>Each report submitted under subsection (a) with
respect to any fiscal year shall include audited financial statements setting
forth the financial position of the Association at the end of such fiscal year
and the results of its operations (including the source and application of its
funds) for such fiscal year.</text></subsection></section><section id="id10ef8874-8cc3-48c6-8446-b2fca3affc4b"><enum>328.</enum><header>Liability of the
Association and the Board members, officers, and employees of the
Association</header><subsection id="id0178e2f0-06a8-49d0-a1b7-dcb13e58fc47"><enum>(a)</enum><header>In
general</header><text>The Association shall not be deemed to be an insurer or
insurance producer within the meaning of any State law, rule, regulation, or
order regulating or taxing insurers, insurance producers, or other entities
engaged in the business of insurance, including provisions imposing premium
taxes, regulating insurer solvency or financial condition, establishing
guaranty funds and levying assessments, or requiring claims settlement
practices.</text></subsection><subsection id="id5995dd9d-a17c-418e-bf11-e639abecd19e"><enum>(b)</enum><header>Liability of Board
members, officers, and employees</header><text>No Board member, officer, or
employee of the Association shall be personally liable to any person for any
action taken or omitted in good faith in any matter within the scope of their
responsibilities in connection with the Association.</text></subsection></section><section id="id3e55ea86-d2a0-478a-9b72-80bac58beae7"><enum>329.</enum><header>Presidential
oversight</header><subsection id="id0af54251-32db-477e-bf8b-67a3f6e4b225"><enum>(a)</enum><header>Removal of
Board</header><text>If the President determines that the Association is acting
in a manner contrary to the interests of the public or the purposes of this
subtitle or has failed to perform its duties under this subtitle, the President
may remove the entire existing Board for the remainder of the term to which the
Board members were appointed and appoint, in accordance with section 324 and
with the advice and consent of the Senate, in accordance with the procedures
established under Senate Resolution 116 of the 112th
Congress, new Board members to fill the vacancies on the Board for the
remainder of the terms.</text></subsection><subsection id="id39b80a87-876d-4d8f-949a-e46296a123d5"><enum>(b)</enum><header>Removal of Board
member</header><text>The President may remove a Board member only for neglect
of duty or malfeasance in office.</text></subsection><subsection id="id656bcd85-e675-4875-bcdc-0e119184b69a"><enum>(c)</enum><header>Suspension of bylaws
and standards and prohibition of actions</header><text>Following notice to the
Board, the President, or a person designated by the President for such purpose,
may suspend the effectiveness of any bylaw or standard, or prohibit any action,
of the Association that the President or the designee determines is contrary to
the purposes of this subtitle.</text></subsection></section><section id="idd2fcd589-1f57-412b-8610-c7586bfa5805"><enum>330.</enum><header>Relationship to State
law</header><subsection id="idf4a593b7-811b-4384-96fd-8d28fd801b29"><enum>(a)</enum><header>Preemption of State
laws</header><text>State laws, regulations, provisions, or other actions
purporting to regulate insurance producers shall be preempted to the extent
provided in subsection (b).</text></subsection><subsection id="idc9888e65-65f3-4e43-bab6-d304b381e334"><enum>(b)</enum><header>Prohibited
actions</header><paragraph id="id8fc626d1-1793-4d3d-9ab7-591574ee9f47"><enum>(1)</enum><header>In
general</header><text>No State shall—</text><subparagraph id="idf4df1b43-f73b-473f-8403-e2f17e96d6ff"><enum>(A)</enum><text>impede the activities of,
take any action against, or apply any provision of law or regulation
arbitrarily or discriminatorily to, any insurance producer because that
insurance producer or any affiliate plans to become, has applied to become, or
is a member of the Association;</text></subparagraph><subparagraph id="id05601d75-31ca-4016-b3d8-5631f1351ec1"><enum>(B)</enum><text>impose any requirement
upon a member of the Association that it pay fees different from those required
to be paid to that State were it not a member of the Association; or</text></subparagraph><subparagraph id="idd8ff2007-2e47-4f44-b0f1-7948d2951d0a"><enum>(C)</enum><text>impose any continuing
education requirements on any nonresident insurance producer that is a member
of the Association.</text></subparagraph></paragraph><paragraph id="iddea99b64-48a3-457d-a371-94a7a2840773"><enum>(2)</enum><header>States other than a
home State</header><text>No State, other than the home State of a member of the
Association, shall—</text><subparagraph id="idff39813b-0d7f-49fb-ba2b-958b25d6a5f1"><enum>(A)</enum><text>impose any licensing,
personal or corporate qualifications, education, training, experience,
residency, continuing education, or bonding requirement upon a member of the
Association that is different from the criteria for membership in the
Association or renewal of such membership;</text></subparagraph><subparagraph id="id204ca69e-173d-43e9-a402-7ed10ebf81f2"><enum>(B)</enum><text>impose any requirement
upon a member of the Association that it be licensed, registered, or otherwise
qualified to do business or remain in good standing in the State, including any
requirement that the insurance producer register as a foreign company with the
secretary of state or equivalent State official;</text></subparagraph><subparagraph id="idf31fd70e-3e1a-46d5-a5d7-a8c1e7a22b63"><enum>(C)</enum><text>require that a member of
the Association submit to a criminal history record check as a condition of
doing business in the State; or</text></subparagraph><subparagraph id="id150c31b2-c8d3-4b95-a632-7a9212400af5"><enum>(D)</enum><text>impose any licensing,
registration, or appointment requirements upon a member of the Association, or
require a member of the Association to be authorized to operate as an insurance
producer, in order to sell, solicit, or negotiate insurance for commercial
property and casualty risks to an insured with risks located in more than one
State, if the member is licensed or otherwise authorized to operate in the
State where the insured maintains its principal place of business and the
contract of insurance insures risks located in that State.</text></subparagraph></paragraph><paragraph id="id9ef54ca0-6cdf-4f7e-a396-0c1c3ddaa567"><enum>(3)</enum><header>Preservation of State
disciplinary authority</header><text>Nothing in this section may be construed
to prohibit a State from investigating and taking appropriate disciplinary
action, including suspension or revocation of authority of an insurance
producer to do business in a State, in accordance with State law and that is
not inconsistent with the provisions of this section, against a member of the
Association as a result of a complaint or for any alleged activity, regardless
of whether the activity occurred before or after the insurance producer
commenced doing business in the State pursuant to Association
membership.</text></paragraph></subsection></section><section id="idc9d34d8e-092f-49c1-b81a-82d96c598753"><enum>331.</enum><header>Coordination with
Financial Industry Regulatory Authority</header><text display-inline="no-display-inline">The Association shall coordinate with the
Financial Industry Regulatory Authority in order to ease any administrative
burdens that fall on members of the Association that are subject to regulation
by the Financial Industry Regulatory Authority, consistent with the
requirements of this subtitle and the Federal securities laws.</text></section><section id="id0d1eab91-ecd5-46b2-9f7f-78f97b93c743"><enum>332.</enum><header>Right of
action</header><subsection id="id7c16af53-38ca-4195-8be3-814b542348fe"><enum>(a)</enum><header>Right of
action</header><text>Any person aggrieved by a decision or action of the
Association may, after reasonably exhausting available avenues for resolution
within the Association, commence a civil action in an appropriate United States
district court, and obtain all appropriate relief.</text></subsection><subsection id="idbbb6c239-7254-4715-ad54-1e51fd310e01"><enum>(b)</enum><header>Association
interpretations</header><text>In any action under subsection (a), the court
shall give appropriate weight to the interpretation of the Association of its
bylaws and standards and this subtitle.</text></subsection></section><section id="id8F67D033A2744C5BAC870A826554F3EA"><enum>333.</enum><header>Federal Funding
Prohibited</header><text display-inline="no-display-inline">The Association may
not receive, accept, or borrow any amounts from the Federal Government to pay
for, or reimburse, the Association for, the costs of establishing or operating
the Association.</text></section><section id="id671e0cb3-eef7-47cb-8b6a-7f185a122db8"><enum>334.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this subtitle, the following
definitions shall apply:</text><paragraph id="id9360d074-dcde-4407-a0c6-ef6aff8c4786"><enum>(1)</enum><header>Business
entity</header><text>The term <quote>business entity</quote> means a corporation,
association, partnership, limited liability company, limited liability
partnership, or other legal entity.</text></paragraph><paragraph id="idA9A7673B707D4B0E9F560D589C5DBAB5"><enum>(2)</enum><header>Depository
institution</header><text>The term <quote>depository institution</quote> has the
meaning as in section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813).</text></paragraph><paragraph id="idf4a8e2df-9b89-46ef-aab0-bed878e008b1"><enum>(3)</enum><header>Home
State</header><text>The term <quote>home State</quote> means the State in which
the insurance producer maintains its principal place of residence or business
and is licensed to act as an insurance producer.</text></paragraph><paragraph id="id4d692431-f0b7-4c0e-b465-9be102ac9562"><enum>(4)</enum><header>Insurance</header><text>The
term <quote>insurance</quote> means any product, other than title insurance or
bail bonds, defined or regulated as insurance by the appropriate State
insurance regulatory authority.</text></paragraph><paragraph id="id389206cb-30ce-4686-85fe-be3baf86b7d2"><enum>(5)</enum><header>Insurance
producer</header><text>The term <quote>insurance producer</quote> means any
insurance agent or broker, excess or surplus lines broker or agent, insurance
consultant, limited insurance representative, and any other individual or
entity that sells, solicits, or negotiates policies of insurance or offers
advice, counsel, opinions or services related to insurance.</text></paragraph><paragraph id="id073DF2D8096348ACA2779BAF0923A855"><enum>(6)</enum><header>Insurer</header><text>The
term <quote>insurer</quote> has the meaning as in section 313(e)(2)(B) of title
31, United States Code.</text></paragraph><paragraph id="idbacb2b7f-7ddb-4ed7-bd1f-aee19806e736"><enum>(7)</enum><header>Principal place of
business</header><text>The term <quote>principal place of business</quote> means
the State in which an insurance producer maintains the headquarters of the
insurance producer and, in the case of a business entity, where high-level
officers of the entity direct, control, and coordinate the business activities
of the business entity.</text></paragraph><paragraph id="ide96e57da-58f0-4a9d-902d-21006adf859d"><enum>(8)</enum><header>Principal place of
residence</header><text>The term <quote>principal place of residence</quote>
means the State in which an insurance producer resides for the greatest number
of days during a calendar year.</text></paragraph><paragraph id="id9fbab872-f53c-479f-8312-ca7d9f6063e3"><enum>(9)</enum><header>State</header><text>The
term <quote>State</quote> includes any State, the District of Columbia, any
territory of the United States, and Puerto Rico, Guam, American Samoa, the
Trust Territory of the Pacific Islands, the Virgin Islands, and the Northern
Mariana Islands.</text></paragraph><paragraph id="idab7f7592-cf7c-401f-89c9-ab764ad7ce5d"><enum>(10)</enum><header>State law</header><subparagraph id="id218e4746-a570-4262-b2c8-64f7e8923d42"><enum>(A)</enum><header>In
general</header><text>The term <quote>State law</quote> includes all laws,
decisions, rules, regulations, or other State action having the effect of law,
of any State.</text></subparagraph><subparagraph id="idfdd696c7-ffb8-4bda-bbbf-91afa36ebe23"><enum>(B)</enum><header>Laws applicable in the
District of Columbia</header><text>A law of the United States applicable only
to or within the District of Columbia shall be treated as a State law rather
than a law of the United
States.</text></subparagraph></paragraph></section><section id="idEA54475B5CE14008A0395191080AF25C"><enum>335.</enum><header>Sunset</header><text display-inline="no-display-inline">The provisions of this subtitle, and any program or authorities established or granted therein or
derived therefrom, shall terminate on the date that is 2 years after the
date on which the Association approves its first member pursuant to
section 323.</text></section></subtitle><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id6d0b1b3c-c446-410c-91c8-062ebbdb9d79"><enum>(b)</enum><header>Technical
amendment</header><text>The table of contents for the Gramm-Leach-Bliley Act is
amended by striking the items relating to subtitle C of title III and inserting
the following new items:</text><quoted-block display-inline="no-display-inline" id="idCD771A1FA4A241C08272E572A72F8C68" style="OLC"><toc><toc-entry level="subtitle">Subtitle C—National Association of Registered Agents and
Brokers</toc-entry><toc-entry level="section">Sec. 321. National Association of Registered Agents and
Brokers.</toc-entry><toc-entry level="section">Sec. 322. Purpose.</toc-entry><toc-entry level="section">Sec. 323. Membership.</toc-entry><toc-entry level="section">Sec. 324. Board of directors.</toc-entry><toc-entry level="section">Sec. 325. Bylaws, standards, and disciplinary
actions.</toc-entry><toc-entry level="section">Sec. 326. Powers.</toc-entry><toc-entry level="section">Sec. 327. Report by the Association.</toc-entry><toc-entry level="section">Sec. 328. Liability of the Association and the Board members,
officers, and employees of the Association.</toc-entry><toc-entry level="section">Sec. 329. Presidential oversight.</toc-entry><toc-entry level="section">Sec. 330. Relationship to State law.</toc-entry><toc-entry level="section">Sec. 331. Coordination with Financial Industry Regulatory
Authority.</toc-entry><toc-entry level="section">Sec. 332. Right of action.</toc-entry><toc-entry bold="off" level="section">Sec. 333. Federal funding
prohibited.</toc-entry><toc-entry level="section">Sec. 334.
Definitions.</toc-entry><toc-entry bold="off" level="section">Sec. 335. Sunset.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></subsection></section>Passed the Senate July 17, 2014.Secretary