soliciting agent, salaried company employee, or resident broker, he shall personally or through his deputy or any person regularly employed in the Department within a reasonable time, and in a designated place within the District, subject each such person to a personal written examination relating to such person's knowledge of the kind or kinds of business to which the license may extend and his competency to act as such policy-writing agent, soliciting agent, broker, or salaried company employee. The Superintendent may in his discretion limit the scope of such examination to such particular kind or kinds of business in which the person to be licensed is to be principally engaged. Following such examination the Superintendent shall issue such license as may be applied for when he is satisfied that the person to be licensed is (a) competent and trustworthy and intends to act in good faith in the capacity involved by the license applied for, and that not more than 25 per centum of his commission income from business to which the license applies will result from policies the premiums on which are paid or are to be paid in the manner set forth in paragraph (f) of section 36; and (b) that he has a good business reputation and has had experience, training, or education, or is otherwise qualified in the line or lines of business in which the license would entitle him to engage, and, except in the case of a nonresident broker or salaried company employee, is a resident of the District, or maintains his principal office for the conduct of such business in the District; and (c) is reasonably familiar with the insurance laws of the District, and with the provisions, terms, and conditions of the policies he is proposing to solicit, negotiate, or effect, and is worthy of a license. In the case of a nonresident applying for a broker's license, the Superintendent may waive the examination requirement and accept in lieu thereof evidence that the applicant holds a license as broker or agent in the State where his principal business is conducted. The Superintendent may also waive the examination requirement in the case of any person who has been licensed in the District prior to the effective date of this Act. Licenses may be issued in the names of individuals, or in the names of firms, partnerships, or corporations, including banks, trust companies, real-estate offices, and building and loan associations: Provided, That on such licenses there shall be listed the name of every member or officer of such firm, partnership, or corporation who solicits insurance or who countersigns policies: And provided further, That such named persons shall be subject to all requirements of this Act, and that no officer or employee of such organizations other than those specifically named in such license shall be required to comply with this section, unless the duties of such officers or employees include soliciting or the countersigning of policies. No person shall be licensed as agent, broker, or salaried company employee when it appears to the Superintendent that said license is sought primarily for the purpose of obtaining commissions on policies on which he on his own account pays or is to pay the premiums, or on which the premiums are paid or are to be paid by any person who receives or is to receive any benefit, direct or indirect, from the commissions obtained, or on which the premiums are paid or are to be paid by any partnership, association, or corporation of which he is a member.

SEC. 33. EFFECTIVE DATES OF LICENSES AND PRORATION OF FEES.-All licenses issued under this Act shall date from the first of the month in which the application for license is made, and shall expire on the 30th day of April next succeeding, and payment of the fees for such licenses shall be prorated accordingly.

SEC. 34. TEMPORARY TRANSFER OF LICENSES.-In the event of the death or disability of any person licensed as a policy-writing agent, soliciting agent, or salaried company employee, the Superintendent may transfer such license to another person without the payment of an additional fee, and may renew such license: Provided, however, That no person shall act as policy-writing agent, soliciting agent, or salaried company employee under any transferred license or renewal thereof for a period in excess of six consecutive months.

SEC. 35. RENEWAL OF LICENSES.-Renewal of all expiring licenses shall be issued by the Superintendent upon application in writing by the applicant for any such license, subject to the conditions of section 36, and subject also to the provisions for examination as set forth in section 32, upon payment of the applicable fee prescribed in section 41.

SEC. 36. REVOCATION AND SUSPENSION OF LICENSES.-The Superintendent may revoke, suspend, or refuse to renew the license of any policy-writing agent, soliciting agent, broker, or salaried company employee when and if, after investigation, it appears conclusively to the Superintendent that any license issued

to such person was obtained by fraud or misrepresentation, or that such person has

(a) Violated any of the provisions of the insurance laws of the District; or (b) Has failed within a reasonable time to remit to any company all moneys which he has collected, and to which the company is entitled; or

(c) Has been guilty of rebating or has misrepresented the provisions of the policies which he is selling, or the policies of other companies; or

(d) Has countersigned policies in blank; or that

(e) More than 25 per centum of his commission income from business to which the license applies results from policies the premiums on which are paid or are to be paid in the manner set forth in paragraph (f) of this section; or that

(f) Said license is being used primarily for the purpose of obtaining commissions on policies on which he, on his own account, pays or is to pay the premiums, or on which the premiums are paid or are to be paid by any person who receives or is to receive any benefit, direct or indirect, from the commissions obtained, or on which the premiums are paid or are to be paid by any partnership, association, or corporation of which he is a member.

Before the Superintendent shall revoke or suspend the license of any such person he shall give to such person an opportunity to be fully heard, and to introduce evidence in his behalf [] Provided, That, in lieu of revoking or suspending the license of any policy-writing agent, soliciting agent, broker, or salaried company employee for causes enumerated in this section after hearing as herein provided, the Superintendent may subject such person to a penalty of not more than $200 when in his judgment he finds that public interest would be best served by the continued operation of such person. The amount of any such penalty shall be paid by such person through the office of the Superintendent to the collector of taxes, District of Columbia. SEC. 37. UNAUTHORIZED SOLICITATION OR REPRESENTATION.-It shall be unlawful for any person, without conforming to the provisions of this Act, directly or indirectly to represent himself as having authority to solicit, negotiate, effect, procure, receive, or forward directly or indirectly any policy or renewal thereof, or to attempt to effect insurance, surety, or indemnity contracts covering any person or insurable interest in the District, or to countersign any policy or renewal thereof.

SEC. 38. WHEN LICENSE NOT REQUIRED.-The provisions of this Act relating to the licensing of policy-writing agents, soliciting agents, salaried company employees, and brokers shall not apply to the sale of personal accident insurance in the ticket offices of railroad companies or other common carriers, or in the offices of travel bureaus, nor to the business of life insurance, fraternal benefit societies, or ocean marine insurance, nor to insurance covering the property of railroad companies and other common carriers engaged in interstate commerce. SEC. 39. UNAUTHORIZED INSURANCE.-Except as provided in section 40 of this Act, no person shall act as agent in the District for any company which is not authorized to do business in the District, nor shall any person directly or indirectly negotiate for or solicit applications for policies of, or for membership in, any company which is not authorized to do business in the District. The term "company" as used in this section shall include any association, society, company, corporation, joint-stock company, individual, partnership, trustee, or receiver engaged in the business of assuming risks of insurance, surety, or indemnity, and any Lloyd's organization, assessment, or cooperative fire company, or any reciprocal or interinsurance exchange, fraternal beneficial association, order, or society, and any company, association, or society, whether organized for profit or not, conducting a business, including any of the principles or features of insurance, surety, or indemnity. Any person who violates any provision of this section upon conviction shall be fined not less than $100 nor more than $1,000 for each offense, or be imprisoned for not more than twelve months, or both, and any such person shall be personally liable to any resident of the District having claim against any such unauthorized company under any policy which said person has solicited or negotiated, or has aided in soliciting or negotiating: Provided, That the provisions of this section shall not apply to any person who negotiates with an unauthorized company for life insurance, or for policies covering his own property or interests, nor shall the provisions of this section apply to the officers, agents, or representatives of any company which is in process of organization under the laws of the District, and which is authorized temporarily to solicit or secure memberships or applications for policies for the purpose of completing such organization.

Prosecutions for violations of this section shall be upon information filed in the police court by the corporation counsel or any of his assistants.

SEC. 40. LICENSES FOR LINES IN UNAUTHORIZED COMPANIES.-Any agent or broker licensed in the District may, upon payment of a license fee, as provided under section 41, be licensed to procure policies from companies which are not authorized to do business in the District where such person is, after diligent effort, unable to procure policies to cover the kind or kinds of business required from companies duly authorized to transact business in the District. Each agent or broker so licensed shall pay to the collector of taxes, through the Superintendent, on February 1 and August 1 of each year, a sum equal to 2 per centum of the amount of the gross premiums upon all kinds of policies procured by him during the immediately preceding six months' period ending December 31 and June 30, respectively, and, in default of such payment, the Superintendent, through the corporation counsel, may bring suit to recover the same. Each agent or broker so licensed to procure policies from unauthorized companies shall execute and file with the Department on or before the 10th day of each month an affidavit covering the transactions of the previous calendar month, setting forth (1) the description and location of the insured property or risk, and the name of the assured; (2) the amount insured in the policy or contract; (3) the gross premiums charged thereon; (4) the name of the company whose policy or contract is issued, and the kind or kinds of business effected; and (5) that said agent or broker after diligent effort was unable to procure the policies or contracts required to protect the property or risk described in the affidavit from companies duly authorized to transact business in the District.

Each agent or broker so licensed to procure policies from unauthorized companies shall keep a separate account of the business transacted thereunder, which shall be open at all times to the inspection of the Superintendent. The license provided for in this section may be revoked or renewal thereof refused for failure to pay the tax or to file the affidavits specified herein, or if the agent or broker procured policies from unauthorized companies without exercising diligent effort to secure the required business in duly authorized companies, or if the agent or broker procured policies from unauthorized companies whose standards of solvency and management do not meet the requirements necessary for the protection of the policyholders [.] or if the agent or broker has placed with any unauthorized company any risk which could be placed with an authorized company except for abnormal provisions of the policy, or if the agent or broker has procured from an unauthorized company any policy which covers a risk of a class generally covered in the District by authorized companies and which authorized companies would cover at a rate not higher than thai charged by authorized companies on other District risks of the same class.

SEC. 41. LICENSE FEES.-Annual fees to be paid through the Superintendent to the collector of taxes for licenses issued under this Act shall be as follows:

(a) For policy-writing agent or for firms, partnerships, or corporations licensed as such, $50, without regard to the number of companies represented: Provided, That, in the case of firms, partnerships, and corporations, an additional fee of $5 shall be charged for each person in excess of two who is named in such license as required under section 32 of this Act.

(b) For soliciting agent, $5 for each company represented by such soliciting agent, or for each company represented by any policy-writing agent through which such soliciting agent solicits: Provided, That no soliciting agent shall be required to pay for soliciting agents' licenses a sum in excess of $15 for any one license year.

(c) For salaried company employee authorized to sign policies and to solicit insurance, $50, without regard to the number of companies represented by such salaried company employee.

(d) For salaried company employee authorized to solicit but not authorized to sign policies, $5 for each company represented by said employee: Provided, That the aggregation of such fees shall not exceed $15 for any one license year.

(e) For nonresident or resident brokers, $25, except that the fee shall be $5 in case the applicant for a resident broker's license is subject also to the fee prescribed under paragraphs (a) or (c) hereof.

(f) For license to procure lines in unauthorized companies, $15.

(g) Under the license issued to any policy-writing agent or salaried company employee, or in the name of any firm, partnership, or corporation as provided under section 32 of this Act, and for which license a fee has been paid in accordance with paragraphs (a) or (c) hereof, there may be added names of persons who are employed in or who actively function through the District office of the policy

writing agent, salaried company employee, or firm, partnership, or corporation, and who have company authority to sign but not to solicit policies. For such persons there shall be charged a fee of $1 per year for each company whose policies such person is authorized to sign.

(h) Broker's licenses may be issued in the names of individuals, firms, partnerships, or corporations. In the case of firms, partnerships, or corporations, the authority to solicit shall extend only to the individuals who are designated in the license and in the application therefor as having authority to solicit, and there shall be charged for each such individual in excess of two an additional fee of $5. (i) Licenses to procure lines in unauthorized companies shall be issued in the names of individuals only.

SEC. 42. TESTIMONY, PRODUCTION OF BOOKS.-No person shall be excused from testifying or from producing books, accounts, and papers in any proceeding based upon or growing out of any violation of the provisions of this Act, on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him may tend to incriminate him or subject him to penalty or forfeiture; but no person having so testified shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he may have testified or produced any documentary evidence: Provided; That no person so testifying shall be exempted from prosecution or punishment for perjury: Provided further, That the immunity hereby conferred shall extend only to a natural person who, in obedience to a subpena, gives testimony under oath or produces evidence, documentary or otherwise, under oath.

SEC. 43. PENALTIES NOT OTHERWISE PRESCRIBED.-Any person who violates any of the provisions of this Act, or fails to comply with any duty imposed upon such person by any of the provisions of this Act, for which violation or failure no penalty is elsewhere provided by this Act, or by the laws of the District, shall, upon conviction thereof, be fined for each offense not exceeding $1,000 or be imprisoned for not more than twelve months, or both. Prosecutions authorized by this section shall be upon information filed in the police court by the corporation counsel or any of his assistants.

SEC. 44. APPEAL FROM SUPERINTENDENT TO COMMISSIONERS.-Any person aggrieved by any action of the Superintendent may, within twenty days after such action was taken, appeal in writing from such action to the Commissioners. The hearings on said appeal may be either orally or in writing at the discretion of the Commissioners, and they shall not be required to take evidence on such appeal. The decision of the Commissioners on any question of fact on such appeal shall be final and conclusive, except the appeal provided for herein shall not affect the right to proceed under the provisions of section 45.

SEC. 45. COURT PROCEEDINGS.-Any person affected by an order, ruling, proceeding, or action of the Superintendent, or any person acting in his behalf and at his instance, may contest the validity of the same in any court of competent jurisdiction by appeal or through any other appropriate proceedings. In said proceedings and appeals said Superintendent shall not be taxed with any costs, nor shall he be required to give any supersedeas bond or security for costs or damages on any appeal whatsoever. Said Superintendent shall not be liable to suit or action or for any judgment or decree for any damages, loss, or injury claimed by any person on any appeal taken by said Superintendent in any case, nor shall said Superintendent be required in any case to make any deposit for costs or pay for any service to the clerks of any court or to any marshal of the United States.

SEC. 46. REPEALS.-All laws or parts of laws, insofar as they relate to business affected hereby, and are in conflict with any of the provisions of this Act, are hereby repealed.

SEC. 47. CONSTITUTIONALITY.-Should any section or provision of this Act be held unconstitutional or invalid, the validity of the Act as a whole, or of any part thereof, other than the part decided to be unconstitutional or invalid, shall not be affected.

SEC. 48. EFFECTIVE DATE OF ACT.-Except where otherwise specifically provided herein, this Act shall become effective thirty days after approval.

O

78TH CONGRESS HOUSE OF REPRESENTATIVES 2d Session

{

REPORT No. 1286

ESTABLISHING A SELECT COMMITTEE ON POST-WAR MILITARY POLICY

MARCH 24, 1944.-Referred to the House Calendar and ordered to be printed

Mr. COLMER, from the Committee on Rules, submitted the following

REPORT

[To accompany H. Res. 465]

The Committee on Rules, having had under consideration House Resolution 465, report the same to the House with the recommendation that the resolution do pass.

О