1 BIL: 3958 2 TYP: General Bill GB 3 INB: House 4 IND: 19990421 5 PSP: Lee 6 SPO: Lee and Davenport 7 DDN: l:\council\bills\nbd\11308jm99.doc 8 RBY: House 9 COM: Judiciary Committee 25 HJ 10 SUB: Insurance Department, Commissioner of; elections of and vacancy 11 provisions 12 13 14 HST: 15 16 Body Date Action Description Com Leg Involved 17 ______18 House 19990421 Introduced, read first time, 25 HJ 19 referred to Committee 20 21 22 Printed Versions of This Bill 23 24 25 26 27 TXT: 1 2 3 4 5 6 7 8 9 A BILL 10 11 TO AMEND SECTION 1-30-10, AS AMENDED, CODE OF 12 LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE 13 DEPARTMENTS OF STATE GOVERNMENT, SO AS TO 14 PROVIDE THAT THE GOVERNING AUTHORITY OF THE 15 DEPARTMENT OF INSURANCE SHALL BE THE 16 “COMMISSIONER OF INSURANCE” ELECTED TO OFFICE 17 UNDER THE LAWS OF THIS STATE; TO AMEND SECTION 18 38-1-20, AS AMENDED, RELATING TO DEFINITIONS 19 UNDER THE INSURANCE LAWS OF THIS STATE, SO AS TO 20 DELETE THE DEFINITION OF “DIRECTOR” OF THE 21 DEPARTMENT OF INSURANCE AND SUBSTITUTE 22 THEREFOR “COMMISSIONER OF INSURANCE”; TO 23 AMEND SECTION 38-3-10, AS AMENDED, RELATING TO 24 THE DEPARTMENT OF INSURANCE, SO AS TO DELETE 25 CERTAIN PROVISIONS RELATING TO THE 26 DEPARTMENT’S DIRECTOR, PROVIDE THAT THE 27 COMMISSIONER OF INSURANCE SHALL BE ELECTED 28 RATHER THAN APPOINTED, AND MAKE CHANGES IN 29 THE PROVISIONS CONCERNING THE REMOVAL OF THE 30 COMMISSIONER; TO AMEND SECTION 38-3-100, AS 31 AMENDED, RELATING TO THE DIRECTOR OF THE 32 DEPARTMENT OF INSURANCE, SO AS TO, AMONG OTHER 33 CHANGES, SUBSTITUTE “COMMISSIONER OF 34 INSURANCE” FOR “DIRECTOR OF THE DEPARTMENT OF 35 INSURANCE” AND DELETE THE REQUIREMENT THAT, IF 36 THE COMMISSIONER BECOMES A CANDIDATE FOR 37 PUBLIC OFFICE OR BECOMES A MEMBER OF A 38 POLITICAL COMMITTEE DURING TENURE, HIS OFFICE 39 MUST BE IMMEDIATELY VACATED; TO AMEND THE 1976 40 CODE BY ADDING SECTION 38-3-102 SO AS TO PROVIDE 41 THAT THE COMMISSIONER OF INSURANCE MUST BE 42 ELECTED TO OFFICE BY THE QUALIFIED ELECTORS OF

1 [3958] 1 1 THE STATE IN THE GENERAL ELECTION AND PROVIDE 2 FOR THE COMMISSIONER’S TERM OF OFFICE, 3 QUALIFICATIONS, VACANCIES, AND RELATED 4 MATTERS; AND TO PROVIDE THAT THE ELECTION OF 5 THE COMMISSIONER OF INSURANCE BEGINS WITH THE 6 2002 STATEWIDE ELECTION PROCESS AND THAT THE 7 DIRECTOR SERVING ON THE EFFECTIVE DATE OF THIS 8 ACT SHALL CONTINUE TO SERVE UNTIL HIS SUCCESSOR 9 IS ELECTED AND QUALIFIES FOR OFFICE AS 10 COMMISSIONER OF INSURANCE; TO PROVIDE THAT 11 EVERY REFERENCE TO “DIRECTOR OF THE 12 DEPARTMENT OF INSURANCE” IN THE 1976 CODE SHALL 13 BE DEEMED TO MEAN “COMMISSIONER OF 14 INSURANCE”; AND TO AUTHORIZE AND DIRECT THE 15 CODE COMMISSIONER TO CHANGE CERTAIN 16 REFERENCES. 17 18 Be it enacted by the General Assembly of the State of South 19 Carolina: 20 21 SECTION 1. Section 1-30-10(B)(1)(iii) of the 1976 Code, as 22 added by Section 1 of Act 181 of 1993, is amended to read: 23 24 “(iii) in the case of the Department of Agriculture and the 25 Department of Education, the State Commissioner of Agriculture 26 and the State Superintendent of Education, respectively, elected to 27 office under the Constitution of this State, and, in the case of the 28 Department of Insurance, the Commissioner of Insurance elected 29 to office under the laws of this State.” 30 31 SECTION 2. Section 38-1-20(16) of the 1976 Code, as last 32 amended by Section 529 of Act 181 of 1993, is further amended to 33 read: 34 35 “(16) ‘Director’ ‘Commissioner of Insurance’ means the 36 person who is appointed by the Governor upon the advice and 37 consent of the Senate elected by the qualified electors of this State 38 and who is responsible for the operation and management of the 39 Department of Insurance. The director commissioner has the 40 authority to appoint or designate the person or persons who shall 41 serve at the pleasure of the director commissioner to carry out the 42 objectives or duties of the department as provided by law. 43 Furthermore, the director commissioner may bestow upon his

1 [3958] 2 1 designee or deputy director commissioner any duty or function 2 required of him by law to manage and supervise the Insurance 3 Department of Insurance.” 4 5 SECTION 3. Section 38-3-10 of the 1976 Code, as last amended 6 by Section 532 of Act 181 of 1993, is further amended to read: 7 8 “Section 38-3-10. There is established a separate and distinct 9 department of this State, known as the Department of Insurance. 10 The department must be managed and operated by a director 11 commissioner appointed by the Governor upon the advice and 12 consent of the Senate elected by the qualified electors of this State. 13 The director commissioner is subject to removal by the Governor 14 as provided in Section 1-3-240(B) from office as may be provided 15 by law for the other officers of the executive department of this 16 State. The director shall be selected with special reference to his 17 training, experience, technical knowledge of the insurance 18 industry, and demonstrated administrative ability. The director 19 commissioner may appoint or designate the person or persons who 20 shall serve at the pleasure of the director commissioner to carry out 21 the objectives or duties of the department as provided by law. 22 Furthermore, the director commissioner may bestow upon his 23 designee or deputy director commissioner any duty or function 24 required of him by law in managing or supervising the Department 25 of Insurance.” 26 27 SECTION 4. Section 38-3-100 of the 1976 Code, as last amended 28 by Section 532 of Act 181 of 1993, is further amended to read: 29 30 “Section 38-3-100. The director Commissioner of Insurance or 31 his designee is not subject to the State Employee Grievance 32 Committee or any internal grievance procedure established at the 33 Insurance Department of Insurance. The director commissioner or 34 his designee shall devote all of his working time to the duties of 35 his office. Before taking the oath of office he shall sever all 36 connections, either direct or indirect, except as a policyholder, with 37 any insurance company or agency and shall maintain the severance 38 during his tenure of office. If he becomes a candidate for public 39 office or becomes a member of a political committee during 40 tenure, his office as director or his designee must be immediately 41 vacated.” 42 43 SECTION 5. The 1976 Code is amended by adding:

1 [3958] 3 1 2 “Section 38-3-102. The Commissioner of Insurance must be 3 elected by the qualified electors of the State in the General 4 election. He may succeed himself in the office. His term begins at 5 noon on the first Wednesday following the second Tuesday in 6 January next following his election and ends at noon on the first 7 Wednesday following the second Tuesday in January four years 8 later. He must be at least thirty years of age at the time his term of 9 office commences. He shall not hold any other public office while 10 serving as commissioner. No candidate for or person elected to the 11 office of commissioner shall accept campaign contributions or 12 anything of value, directly or indirectly, from insurance companies 13 regulated by the Department of Insurance, or their subsidiaries, or 14 from insurance agents or any other insurance professionals 15 regulated pursuant to Title 38 including, but not limited to, 16 employees or immediate family members of such insurance agents, 17 other insurance professionals, and officers, directors, and managers 18 of such insurance companies or subsidiaries. Notwithstanding any 19 other provision of law, a vacancy in the office of commissioner 20 must be filled by the Governor for the unexpired portion of the 21 term.” 22 23 SECTION 6. The election of the Commissioner of Insurance 24 provided in Section 38-3-102 of the 1976 Code, as contained in 25 Section 5 of this act, begins with the 2002 statewide election 26 process. The director serving on the effective date of this act shall 27 continue to serve until his successor is elected and qualifies for 28 office as Commissioner of Insurance. 29 30 SECTION 7. (A) Every reference of any kind whatever to 31 “Director of the Department of Insurance” in Title 38 and in any 32 other provision of law contained in the 1976 Code of Laws shall be 33 deemed to mean “Commissioner of Insurance”. 34 (B) The Code Commissioner is authorized and directed to 35 change in an timely manner all references to “Director of the 36 Department of Insurance” to “Commissioner of Insurance”. 37 38 SECTION 8. Except as otherwise specifically provided herein, 39 this act takes effect January 1, 2002. 40 ----XX----

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