AN ACT TO AMEND THE REVISED CODE OF DELAWARE, 1935, BY DEFINING "GROSS PREMIUMS" WHEN REFERRING TO INSURANCE COMPANIES OR INSURANCE POLICIES.
Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met:
Section 1. That 87, Section 53, of Chapter 6, Revised Code of Delaware, 1935, be and the same is hereby amended by striking out all of 87, Section 53, and inserting in lieu thereof a new section to be known as 87, Section 53.
87. Section 53. Taxes on All Insurance Except Workmen's Compensation; Dividends Deducted From Gross Amount of Premiums; Statements of Receipts Delivered to Insurance Commissioner; "Gross Premiums" Defined:--Each and every insurance company doing an insurance business of any kind within the State of Delaware, excepting that of workmen's compensation insurance, shall, on the first day of March, of each year, pay to the Insurance Commissioner, for the use of the State, one and one-half per centum upon the gross amount of premiums received and assessments collected from insurance of every kind upon persons or on the lives of persons resident in, or upon real and personal property located within this State, or upon any other risks insured within this State, by any such insurance company or the authorized agent thereof, for the calendar year immediately preceding the date herein provided for such payments; provided, however, that in computing the gross amount of premiums received and assessments collected as herein defined, there shall be deducted dividends paid to policyholders.
Each and every insurance company, firm or corporation as hereinbefore mentioned in this Section shall at the time of making such payments, deliver to the Insurance Commissioner a full and detailed statement showing the gross amount of such premiums received and assessments collected and dividends paid to policyholders by such insurance company, firm or corporation, or the authorized agent thereof, for the calendar year immediately preceding the date herein provided for such payments, and such statement shall be verified by the oath or affirmation of the President or Secretary or other responsible officer of said company, duly administered by some person authorized to administer oaths.
The words "gross premiums" whenever used herein in reference to premiums received by insurance companies on policies covering risks located in the State of Delaware, shall be taken and held to mean all moneys collected, together with all notes, or credits allowed, as premiums on such policies including reinsurance premiums received. In computing taxable premiums there may be deducted from "gross premiums" dividends paid to policyholders, return premiums paid therefrom by reason of cancellation of policies, and reinsurance premiums received from other companies.
Section 2. That 89, Section 55 of Chapter 6, Revised Code of Delaware, 1935, be and the same is hereby amended by striking out all of 89, Section 55, and inserting in lieu thereof a new section to be known as 89, Section 55.
89. Section 55. Special Tax on Fire Insurance Companies:--For the purpose of assisting in maintaining fire companies or departments in this State, every fire insurance company doing business in this State shall annually pay to the Insurance Commissioner on or before the first day of March in addition to the other taxes, fees and charges required by law, a tax equal to two per centum of the gross premiums, less return and reinsurance premiums received from other companies or by any agent or agents of such company for such company, in cash or otherwise, from the insurance of property within the limits of this State during the preceding calendar year. In case of a mutual company, the dividends paid or credited to members on such premiums shall be construed to be return premiums.
The money so received shall be set aside as a special fund for assisting in maintaining fire companies or departments in this State and shall be paid out by the State Treasurer to the Treasurer
of the City of Wilmington, and to the respective Treasurers of each County for the sole purpose of assisting in maintaining fire companies or departments in such Counties in such manner and in such proportions as is hereinafter provided.
It shall be the duty of all active fire companies or departments in this State outside of the limits of the City of Wilmington, to register with their respective County Treasurer on or before the first day of April in each year on a blank provided for this purpose giving their location, apparatus, and equipment maintained.
Every fire insurance company doing business in this State shall annually at the same time that such company files its annual report now required to be filed by law, deliver to the Insurance Commissioner a full detailed statement of all business done by such company in the City of Wilmington; in the County of New Castle, outside of the City of Wilmington; in Kent County; and in Sussex County; for the year ending on the previous Thirty-first day of December, which statement shall be verified by the oath or affirmation of the President or Vice-President and Secretary or other officer. Said statement shall be on the blanks prepared and furnished by the Insurance Commissioner for that purpose.
The Insurance Commissioner shall ascertain and report to the State Treasurer, on or before the fifteenth day of April, in each year, the amount of business done by each Fire Insurance Company in the City of Wilmington; in the County of New Castle, outside of the City of Wilmington; in Kent County and in Sussex County; and from such report the State Treasurer shall ascertain the amount due and owing to the City Treasurer of the City of Wilmington, and to the Treasurers of the respective counties of this State, under this Article, and on or before the first day of May of each year, shall pay to the Treasurers of the respective Counties in this State, the proportionate amounts due under this Article, which said amounts shall be used by the Levy Court of the respective Counties, exclusively for the purpose of assisting in maintaining fire departments in said Counties, and shall be distributed equally among all fire companies or departments regularly organized and motorized in such County. Provided; that the money realized under the provisions of this Article from insurance on property within the incorporated limits of the City of Wilmington shall be paid to the Treasurer of the said City of Wilmington and shall be applied to, and become a part of the Firemen's Pension Fund of the Bureau of Fire of the City of Wilmington, and shall be used as directed in the by-laws and constitution of the said Bureau.
And provided further, it shall be unlawful for any Fire Insurance Company to increase the rate of insurance premium upon any property affected by this Article because of the tax hereinbefore provided, unless the Insurance Commissioner after a hearing on the matter shall be satisfied that an increase is necessary, and in the event that the Insurance Commissioner shall be satisfied after such hearing that an increase in the premium rate is necessary, he shall authorize such reasonable increase as he shall deem fair and equitable.
Section 3. That 6127, Section 57 of Chapter 175, Revised Code of Delaware, 1935, be and the same is hereby amended by striking out of said section paragraphs (a) and (b) and inserting in lieu thereof two new paragraphs to be known as paragraphs (a) and (b) respectively, as follows:
(a) Every insurance carrier hereinbefore referred to, insuring employers who are or may be liable under this chapter to pay for compensation for personal injuries to or death of their employees, under the provisions of this chapter, shall, as hereinafter provided, pay a tax upon all workmen's compensation or employers' liability premiums received, whether in cash or notes, in this State, or on account of business done in this State, or on account of premiums for compensation payable under said Compensation Law for such insurance in this State, at the rate of four per centum of the amount of such premiums, which tax shall be in lieu of all other taxes on such premiums, and said tax shall be assessed and collected as hereinbefore provided; provided, however, that such insurance carrier shall be credited with all cancelled or returned premiums actually refunded during the year on such insurance, and premiums on reinsurance received from other insurance carriers; provided, further, that mutual insurance companies shall be taxed upon the gross premium charged and collected and shall not be credited with unabsorbed premiums or dividends.
(b) Every such insurance carrier shall on or before the first day of March of each year make a return verified by the affidavit of its President and Secretary, or other chief officers or agents, to the Insurance Commissioner of the State of Delaware, stating the amount of all such premiums and credits for the preceding calendar year. Every insurance carrier required to make such return shall pay to the Insurance Commissioner a tax of four dollars per hundred on such premiums ascertained as provided in sub-paragraph (a) of this section, less return premiums on cancelled policies actually refunded during the year and reinsurance premiums received from other insurance carriers. Upon receiving payments the Insurance Commissioner shall pay the same to the State Treasurer.
Approved April 6, 1939.