New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 17D - INSURANCE PRODUCER STANDARDS OF CONDUCT: ADMINISTRATIVE PROCEDURES AND PENALTIES
Subchapter 2 - ADMINISTRATIVE PROCEDURES AND PENALTIES
Section 11:17D-2.1 - Procedures for the imposition of administrative penalties

Universal Citation: NJ Admin Code 11:17D-2.1

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

(a) Rules concerning the initiation of action against an alleged violator follow:

1. Before an administrative penalty is imposed, the Department shall direct a notice by certified mail or personal delivery to the last known business or mailing address of the alleged violator. The notice shall include:
i. A reference to the statute, rule and/or administrative order alleged to be violated;

ii. A concise statement of the facts alleged to constitute the violation;

iii. A statement of the administrative penalty or penalties sought to be imposed; and

iv. A statement advising the alleged violator of the right to a hearing and the procedure for requesting a hearing.

2. The notice may describe more than one violation, or more than one specific penalty for each violation. A single form of notice may be used to notify several alleged violators, so long as all are named and served with a copy of the notice in conformity with the provisions of (a)3 below.

3. The notice shall be served by personal delivery, or by certified mail to the alleged violator's last known business or mailing address, according to the files maintained by the Department. Service in this manner shall be considered lawful service on the alleged violator.

(b) Rules concerning the failure of an alleged violator to respond to a notice follow:

1. The alleged violator's failure to respond, as required by the notice, within the time provided in the notice, shall be deemed to be an admission to all of the allegations, charges and conclusions contained in the notice, and no further proceeding shall be required prior to the execution of a final order that imposes the administrative penalty or penalties described in the notice.

2. If no response is received within the time provided in any notice to suspend or revoke a license or authority to conduct any activity regulated by Title 17 and 17B, the Department shall prepare a final order suspending or revoking the license or authority to conduct such activity, and mail a copy of the order to the violator at his or her last known business address on file with the Department.

3. If the notice provides for the payment of any fine, compels any restitution or reimbursement to the Department for investigative or prosecution cost, and payment or proof of payment has not been received, the Department may proceed to suspend or revoke the license or authority of the violator as provided in 11:17D-2.1.

(c) Rules concerning an alleged violator's consent to an administrative penalty follow:

1. In order for matters set forth in a notice to be deemed concluded by means of a consent by the alleged violator to the imposition of the administrative penalty described in the notice, the Department may require any or all of the following:
i. The return to the Department for cancellation of any license or other written evidence of the authority to conduct the business of insurance in this State;

ii. The payment of a monetary penalty;

iii. The reimbursement to the Department of the costs of investigation and prosecution;

iv. The restitution of moneys owed any person; and

v. The execution of an administrative order which may include admissions of material facts, conclusions of law, and such other terms and conditions as the Commissioner, or his or her authorized designee may deem to be necessary and appropriate under the circumstances.

(d) Rules concerning a request by an alleged violator for a hearing follow:

1. An alleged violator shall have 20 calendar days from service of the notice of intent to impose an administrative penalty within which to deliver a written request for a hearing to: Chief of Investigations, New Jersey Department of Banking and Insurance, PO Box 329, Trenton, New Jersey 08625-0329, or faxed to the Department at (609) 292-5337.

2. A request for a hearing shall include:
i. The name, address and daytime telephone number of the alleged violator;

ii. A copy of the notice;

iii. A statement requesting a hearing;

iv. A specific admission, denial or explanation of each fact alleged in the notice, or a statement that the person is without knowledge thereof; and

v. A concise statement of the facts or principles of law asserted to constitute any factual or legal defense.

3. If a hearing request fails to include a specific admission, denial or explanation of each fact alleged, or a statement that the person is without knowledge thereof, the facts alleged in the notice shall be deemed to have been admitted.

4. If a hearing request lacks any of the elements in (d)2 above, the Department may deny the request or by certified mail advise the person of the deficiencies and provide an additional 10 calendar days from the issuance of the deficiency letter to correct them. If no reply correcting the deficiencies is received by the Department within 10 calendar days, the Department may issue a final order without granting a hearing.

5. Upon receipt of a properly completed request for a hearing, the Manager of Enforcement, or such other Department personnel as may be designated by the Commissioner, shall examine the request and may conduct or direct such further proceedings as may be appropriate, including, but not limited to, an interview with the alleged violator.

6. Not later than 60 days after the receipt of a properly completed request for a hearing, the Manager of Enforcement, or such other Department personnel as may be designated by the Commissioner, shall advise the alleged violator of the manner of disposition, which may be as follows:
i. Terminated with or without prejudice;

ii. Resolved by consent order, which may provide for a lesser or different administrative penalty; or

iii. A finding that the matter constitutes a contested case, pursuant to the Administrative Procedure Act, 52:14B-1 et seq. In such a case, the Department shall transmit the matter to the Office of Administrative Law for a hearing consistent with the Uniform Administrative Practice Rules, N.J.A.C. 1:1.

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