A decision empowers the Banking and Insurance Commissioner

It is now clear that the Commissioner of the Department of Banking and Insurance (DOBI) can bring an administrative action for violation of state laws and insurance practices against “unadmitted foreign insurance companies”, carriers that are not licensed in New Jersey and licensed. subsidiaries in New Jersey. According to the opinion of the Appeal Division of April 27 in Applied Underwriters Captive Risk Assurance Co. v. Department of Banking and Insurance, an action in Superior Court by the Attorney General is not the only enforcement mechanism.

Under Section 20 of the Unadmitted Insurers Act, NJSA 17:32-16-23, “the Attorney General, at the request of the Commissioner [of DOBI] will bring a civil action in the Superior Court for an injunction” or other appropriate relief when it appears that an insurer, or its agent or representative “has violated, violates or is about to violate” the law. The Appeals Chamber found that “[b]According to the text, legislative history and public policies of the act as a whole, as well as the principles of primary jurisdiction, the commissioner has the power to bring an administrative complaint against these companies instead of a legal action brought by the attorney general. It is now clear, in the absence of Supreme Court review, that the Commissioner has the discretion to choose the forum and has the authority to prosecute administratively against a carrier or, through the Ministry of Law and Public Security, in an action in Superior Court.