In Property And Casualty Insurance, Where Does The Agent Deposit The Premium?

In case of property and casualty insurance, the agent or broker must deposit the premium in one of more accounts (which are called premium accounts) which are opened for this purpose and appropriately identified. These accounts must be opened in banks which are duly authorised to do business in this state. No withdrawals can be made from these accounts except if it specified hereinafter.

The insurance agent or broker must maintain a premium account if he does not remit the premium immediately to the insurers or the parties who are assured of such funds. However, it is not mandatory for the insurance agent or broker to open a premium account with a bank if he does not remit the premium immediately to the insurers or the parties who are assured of such funds. The excess amount of premium which is deposited in a premium account is the minimum balance which is required to maintain the premium account.