S.C. Code Ann. § 38-91-210 – 063)[Ceases to be of any force or effect after February 28, 2003] Application for coverage through the association; review of applications; penalties against agents or brokers who improperly assign applicants

(a) Any qualified applicant shall, on or after the effective date of the plan of operation, be entitled to apply for coverage through the association. The application may be made on his behalf by any licensed resident agent or broker authorized by him. Every licensed resident agent or broker shall offer to place insurance through the association for any qualified applicant for whom he is unable to procure such insurance through the markets available to him. Coverage limits may be provided up to $250,000 per person and $500,000 per accident for bodily injury, $100,000 property damage or a combined single limit of $500,000 and fire, theft, comprehensive and collision coverage. In order to place the insurance of the applicant through the association, the agent or broker on the application must show (i) that the applicant has been refused automobile insurance coverage by at least one insurer, agent, or broker, and (ii) the reasons for refusal. The applicant must by his signature acknowledge this showing.
(b) The director of the Department of Insurance or his designee may review each application and provide such application to other qualified insurers. The director or his designee may assign the applicant to any qualified insurer other than the association willing to accept such coverage in the voluntary market. The agent who placed such applicant in the association for automobile insurance coverage shall not receive any commission from this insurance policy or applicant upon placement by the director or his designee of this applicant voluntary market; provided, however, any commission received or paid on the sale of this policy for such applicant must be refunded.
(c) If the director or his designee determines that any agent or broker has placed ten percent or more of his applications with the association and if the director or his designee further determines that the agent improperly assigned applicants insurable through regular underwriting in the voluntary market to the association, then the director or his designee shall assess any one of, a combination thereof, or all, of the following penalties against the agent or broker: (i) a fine up to five thousand dollars per violation; (ii) suspension of that agent's or broker's right to place coverages with the association, or his binding authority, for a specified period of time; or (iii) suspension or revocation of the agent's or broker's license to offer automobile insurance in the State. In his review of the agent's or broker's residual market business, the director or his designee may consider whether the insurer, agent, or broker is participating in a pattern of unfair discrimination as provided in Section 38-77-122 and Section 38-77-123.
(d) If the association determines that the applicant is a qualified applicant eligible under the plan of operation, then the association, upon receipt of the premium, or such portion thereof as is prescribed in the plan of operation, shall issue or cause to be issued a policy of automobile insurance and policy periods as are available under the plan of operation as may be requested.
If the director or his designee finds, after a hearing, with respect to any specified geographical area in the State, that a large number of persons are failing to gain the benefits of the association because they do not have the services of an agent or broker, the association shall provide service to assist the public in applying to the association for insurance.
(e) The association shall monitor applications submitted to the association in order to ascertain if applications are correct, complete, and reflect that actual risk of the insured. The association shall select a subcommittee of three board members who will review applications. The subcommittee may develop and enforce requirements on applications and if requirements are not met by agents submitting applications, shall suspend the ability of that agent to bind applications for thirty days as well as prescribe audit fees to be applied to applications from particular agents. In the event of three suspensions for a particular agent in any five-year period, the ability of that agent to bind applications shall be suspended for three years. In the event of four suspensions for agents in a particular agency in any five-year period, the ability of that agency to bind applications shall be suspended for three years. Appeals of the subcommittee shall be made to the full board and then the director or his designee.
The association shall monitor agents to ensure that insureds are not forced to purchase other insurance coverages in order for the agent to submit the application to the association. The association or the director of the Department of Insurance may require agents to disclose all policies written in conjunction with a policy through the association.