§ 1.3 Agents

• Library: Guide to South Carolina Liability and Property Insurance Law (SCBar) (2019 Ed.)

§ 1.3 Agents

S.C. Code of Laws § 38-43-10 governs insurance producers and agencies and provides:

(A) A person who:

(1) sells, solicits, or negotiates insurance on behalf of an insurer;
(2) takes or transmits other than for himself an application for insurance or a policy of insurance to or from an insurer;
(3) advertises or otherwise gives notice that he will receive or transmit insurance applications or policies;
(4) receives or delivers a policy of insurance of an insurer;
(5) receives, collects, or transmits any premium of insurance; or
(6) performs any other act in the making of an insurance contract for or with an insurer, other than for himself; whether these acts are done by an employee of an insurer or at the instance or request of an insurer, must be an appointed producer of the insurer for which the act is done or the risk is taken unless provided otherwise in Section 38-43-20.

(B) This chapter does not apply to excess and surplus lines brokers licensed pursuant to Section 38-45-30 except as provided in Section 38-43-70.
(C) An insurance producer doing business under any name other than the producer's legal name is required to notify the director or his designee prior to using the assumed name.⁸

Further, the South Carolina Supreme Court has stated that generally, an independent insurance agent is considered to be the agent of the insured.⁹ However, the Court has also noted that an independent agent can be the insurance company's agent and not the agent or broker of the insured when the company is one of the agent's licensed companies.¹⁰ The Court has held that "independent insurance agents' licenses with several insurers are, with respect to policies issued on the agents' efforts, evidence of agency with and authority to speak for the insurers for which they are licensed."¹¹ Further, the Court has determined that the license acts as evidence of authority to bind the insurer and the rule is consistent with the requirements set forth in section 38-43-10 because the licensing acts were done "at the instance or request of the insurer.¹²

Further, South Carolina law makes a distinction between insurance brokers and insurance agents:

A broker is ordinarily one who acts as a middleman between the insured and insurer and who solicits insurance from the public under no employment from any special company, but having secured an order, either places the insurance with a company selected by the insured or with a company selected by the broker himself.
A broker is ordinarily employed by a person seeking insurance, and when so employed is to be distinguished from the ordinary insurance agent who is employed by an insurance company to solicit and write insurance in the company.
Where one has no agency license with the insurer, and is

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