About examinations
An examination is a review of your fiduciary responsibility for the handling of premium funds and accounting RECORDS for those funds. Examinations are conducted to determine compliance with the following laws and regulations:
- RCW 48.17.250 Insurance producer’s bond,
- RCW 48.17.270 Compensation disclosure for insurance producers,
- RCW 48.17.470 Records of insurance producers,
- RCW 48.17.480 Reporting and accounting for premiums,
- RCW 48.17.600 Separation of premium funds,
- RCW 48.18.220 Receipt of premium to bind coverage—Contents of receipt,
- WAC 284-12-080 Requirement for separate accounts, and
- WAC 284-30-550 Receipts to be given
If you are a surplus line licensee, the examination often confirms certification forms are appropriately filed and taxes are paid, as required by RCW 48.15.
Examination process
Our examiner will notify you of the examination by email and request documents and records. The examiner will follow-up with a call to discuss the examination process.
The financial examination primarily focuses on the accounting records maintained for the separate premium account and the premium detail provided by the insured. The examiner evaluates the licensee's policies and practices to process and return premium, as well as the existence of adequate accounting records that provide an audit trail.
After the examination
At the completion of the examination, you will receive an examination report by email. If there are no findings, the examination is closed, and the examination process is complete. If there are areas of non-compliance, a follow-up examination will be scheduled to confirm you made the changes have been made to follow the law and regulations.
In rare circumstances, there could be a referral for administrative action. We will notify you if this occurs.