N.Y. Comp. Codes R. & Regs. tit. 11, § 20.3 – Fiduciary responsibility of insurance agents, title insurance agents, and insurance brokers; premium accounts.

(a) This section is issued for the purpose of interpreting, and facilitating compliance with, Insurance Law section 2120(a) and (c).
(b) Every insurance agent, a title insurance agent, and an insurance broker is responsible as a fiduciary for funds received by such insurance agent, title insurance agent, or insurance broker in such capacity; all such funds shall be held in accordance with the following paragraphs:
1. (1) An insurance agent, a title insurance agent, or an insurance broker who does not make immediate remittance to insurers and insureds of such funds shall deposit them in one or more appropriately identified accounts in a bank or banks duly authorized to do business in this State, from which no withdrawals shall be made except as hereinafter specified (any such account is hereinafter referred to as “a premium account”).
2. (2) An insurance agent, a title insurance agent, or an insurance broker who makes immediate remittance to insurers and insureds of such funds need not maintain a premium account for such funds.
3. (3) Deposits in a premium account in excess of aggregate net premiums received but not remitted may be made to maintain a minimum balance, to guarantee the adequacy of the account, or to pay premiums due but uncollected (any such deposit is hereinafter referred to as “a voluntary deposit”).
4. (4) No withdrawals from a premium account shall be made other than for payment of premiums to insurers, payment of return premiums to insureds, payment or other distribution of any other funds received or collected by the insurance agent, title insurance agent, or insurance broker in a fiduciary capacity; transfer to a non-premium account of compensation received pursuant to Insurance Law section 2119 as provided in section 20.6 of this Part; transfer to an operating account of:
  1. (i) interest, if the principals have consented thereto in writing; and
  2. (ii) commissions, or withdrawal of voluntary deposits, provided, however, that no withdrawal may be made if the balance remaining in the premium account thereafter is less than aggregate net premiums received but not remitted.
5. (5) Deposit of a premium in a premium account shall not be construed as a commingling of the net premium and of the commission portion of the premium.
6. (6) In the case of an insurance agent or a title insurance agent operating under an “account current system”, maintenance at all times in one or more premium accounts of at least the net balance of premiums received but not remitted shall be construed as compliance with Insurance Law section 2120(a) and (c), provided that the funds so held for each such principal are reasonably ascertainable from the insurance agent’s or title insurance agent’s records.
(c) Except as hereinabove provided, an insurance agent, a title insurance agent, or an insurance broker shall not commingle any funds received or collected as an insurance agent, a title insurance agent, or an insurance broker with his, her, or its own funds or with funds held by him, her, or it in any other capacity without the written consent of the person, firm, or corporation for whom they are held in a fiduciary capacity.
(d) If any provision of this section or the application thereof to any person or circumstances is held unauthorized by law, then the remainder of the section and the application of such provision to other persons or circumstances shall not be affected thereby.