December 2006
THIS STATE LAW SURVEY IS BEING PROVIDED TO INSUREDS OF NUCLEAR ELECTRIC INSURANCE
LIMITED FOR INFORMATIONAL USE ONLY AND NOT AS LEGAL ADVICE, OR AS AN OPINION OF LAW. IT IS
SIMPLY AN INDICATION OF WHAT GENERAL RESEARCH SUGGESTS IS THE RELEVANT LAW. NO PARTY
SHOULD RELY ON THE FOLLOWING INFORMATION IN MAKING DECISIONS AS TO LEGAL ISSUES.
NEW HAMPSHIRE
Page
Insurance Authorization Status .............................................................................................. 1
Contract Enforceability by Unauthorized Insurers ................................................................ 1
Enforceability of Arbitration Provisions................................................................................ 2
Enforceability of Choice of Law Provisions.......................................................................... 2
Enforceability of Choice of Forum Provisions ...................................................................... 3
Cancellation of an Insurance Contract .................................................................................. 3
Waiver of Statutory Rights .................................................................................................... 3
Insurance Authorization Status
In New Hampshire, a foreign or alien
insurance company shall not “do insurance
business” within New Hampshire unless it has
obtained a license from the Insurance
Commissioner.
N.H. REV. STAT. ANN.
§ 405:1.
The unauthorized insurance
provisions do not apply to any insurance
company issuing contracts of insurance to
industrial insureds, and any contract of
insurance issued to any one or more industrial
insureds are exempt from the definition of
“doing an insurance business.” N.H. REV.
STAT. ANN. § 406-B:16, VI. An “industrial
insured” is: (1) An insured who procures the
insurance of any risk or risks other than life
and annuity contracts by use of the services of
a full time employee acting as an insurance
manager or buyer or the services of a
regularly and continuously retained qualified
insurance consultant; and (2) An insured
whose aggregate annual premiums for
insurance on all risks total at least $15,000;
and (3) An insured having at least 25 full time
employees. N.H. REV. STAT. ANN. § 406B:16, VI. All “industrial insureds” must pay
to the commissioner of insurance before
March 1 of the succeeding the calendar year
in which the insurance was so effectuated,
continued, or renewed a premium receipts tax
of 3 percent of the gross premiums charged
for such insurance. Id.
The unauthorized insurance provisions also
do not apply to “[t]ransactions involving
contracts of insurance independently procured
through negotiations occurring entirely
outside of [New Hampshire] which are
reported and on which premium tax is paid in
accordance with RSA 406-B:17.” 1 N.H.
REV. STAT. ANN. § 406-B:16, IV.
Contract Enforceability by Unauthorized
Insurers
Contracts of insurance that are entered into by
an unauthorized insurer are valid insurance
contracts. N.H. REV. STAT. ANN. § 406-B:8,
II (“the failure of any insurer transacting
insurance business in this state to obtain a
certificate of authority shall not impair the
validity of any act or contract of such insurer
and shall not prevent such insurer from
defending any action at law or suit in equity
in any court”).
However, before an unauthorized insurer may
defend any action, the unauthorized insurer
December 2006
THIS STATE LAW SURVEY IS BEING PROVIDED TO INSUREDS OF NUCLEAR ELECTRIC INSURANCE LIMITED
FOR INFORMATIONAL USE ONLY AND NOT AS LEGAL ADVICE, OR AS AN OPINION OF LAW. IT IS SIMPLY AN
INDICATION OF WHAT GENERAL RESEARCH SUGGESTS IS THE RELEVANT LAW. NO PARTY SHOULD RELY
ON THE FOLLOWING INFORMATION IN MAKING DECISIONS AS TO LEGAL ISSUES.
must satisfy a pre-answer security
requirement by filing a bond sufficient to
secure payment of any final judgment or
obtaining a certificate of authority. N.H. REV.
STAT. ANN. § 406-B:6, I. As set forth above
in the “Insurance Authorization Status”
section, however, an out-of-state insurer that
issues policies to industrial insureds, or which
issues policies that are independently
procured through negotiations occurring
entirely outside of New Hampshire is not
required to procure a license. 1
decision). See, e.g., Aetna Life & Cas. Co. v.
Martin, 134 N.H. 90, 93, 588 A.2d 813, 81415 (1991) (applying arbitration provisions of
uninsured motorist coverage section of
automobile policy and commenting that “the
jurisdiction of arbitrators over the parties and
the subject matter depends entirely upon the
voluntary agreement of the parties”).
Enforceability of Choice of Law Provisions
New Hampshire has no statutory provision
which would prevent the enforcement of a
valid choice of law provision in commercial
insurance contracts, nor have the New
Hampshire courts directly addressed the issue
in the context of commercial insurance
policies.
The New Hampshire Supreme
Court, in the context of uninsured motorist
claims under automobile insurance policies,
has held that New Hampshire will apply the
Restatement (Second) of Conflicts of Laws
approach to determine which state’s law will
govern the interpretation of an insurance
contract. Glowski v. Allstate Ins. Co., 134
N.H. 196, 198, 589 A.2d 593, 595 (1991);
Cecere v. Aetna Ins. Co. 145 N.H. 660, 766
A.2d 696 (N.H. 2001). In each of these cases
the courts have held that the Restatement’s
“most significant relationship” test will be
applied only “in the absence of an express
choice of law by the parties.” Stevens v.
Merchants Mut. Ins. Co., 135 N.H. 26, 28,
599 A.2d 490, 491 (1991). In Cecere, the
New Hampshire Supreme Court, in citing
Glowski, provided that this general rule
articulates “the fundamental contract policy
of giving effect to the intention of the parties
and their reasonable justified expectations.”
766 A.2d at 98 (citations omitted).
Enforceability of Arbitration Provisions
The New Hampshire arbitration code favors
arbitration. N.H. REV. STAT. ANN. § 542:1 (a
provision in any written contract to settle by
arbitration a controversy thereafter arising out
of such contract, or an agreement in writing to
submit to arbitration any controversy existing
at the time of the agreement to submit, shall
be valid, irrevocable and enforceable, save
upon such grounds as exist at law or in equity
for the revocation of any contract).
While New Hampshire courts have not
addressed the issue, arbitration provisions in
commercial insurance contracts should be
enforced. New Hampshire courts accept the
basic tenet that “the purpose of arbitration is
to obtain a speedy and inexpensive resolution
of a dispute before the arbitrators of the
parties’ choice, thereby foregoing the
ordinary process of the law.”
Demers
Nursing Home, Inc. v. R.C. Foss & Son, Inc.,
122 N.H. 757, 761, 449 A.2d 1231, 1233
(1982) (enforcing arbitration provision in
construction contract and focusing on the
intent of the parties when reaching this
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December 2006
THIS STATE LAW SURVEY IS BEING PROVIDED TO INSUREDS OF NUCLEAR ELECTRIC INSURANCE LIMITED
FOR INFORMATIONAL USE ONLY AND NOT AS LEGAL ADVICE, OR AS AN OPINION OF LAW. IT IS SIMPLY AN
INDICATION OF WHAT GENERAL RESEARCH SUGGESTS IS THE RELEVANT LAW. NO PARTY SHOULD RELY
ON THE FOLLOWING INFORMATION IN MAKING DECISIONS AS TO LEGAL ISSUES.
Enforceability
Provisions
of
Choice
of
V. It would for some other reason be
unfair or unreasonable to enforce the
agreement.
Forum
Under New Hampshire law, choice of forum
provisions are enforceable “if the contract
bears any significant relationship to that
jurisdiction.” Hobin v. Coldwell Banker
Residential Affiliates, Inc., 744 A.2d 1134,
1137 (N.H. 2000) (upholding a forum
selection clause in a franchise agreement)
(citation omitted).
New Hampshire has
enacted the “Uniform Model Choice of
Forum Act” as Chapter 508-A of the New
Hampshire Statutes Annotated. Under this
Act,
N.H. REV. STAT. ANN. § 508-A:3. See Ford
Const. Co. v. TWG Const. Co., Inc., 2004 WL
585629 (N.H. Super. Slip Op. 2/10/04) (Case
brought in New Hampshire dismissed due to
contract clause identifying a New York
county as forum).
Cancellation of an Insurance Contract
Chapter 417-B of the New Hampshire
insurance code governs “Cancellation,
Refusal to Write, Refusal to Renew Certain
Property and Liability Insurance.” N.H. REV.
STAT. ANN. § 417-B:1 et seq. This chapter
does not apply to insurance policies that are
“primarily insuring risks arising from the
conduct of a commercial or industrial
enterprise.” N.H. REV. STAT. ANN. § 417B:1, III. Moreover, the substantive provisions
of the chapter only apply to insurers who are
“authorized to issue policies of insurance in
the state of New Hampshire.” N.H. REV.
STAT. ANN. § 417-B:8. Accordingly, policies
issued by an unauthorized insurer to industrial
insureds or which are independently procured
with respect to a commercial enterprise are
not subject to the notice and cancellation
provisions set forth in Chapter 417-B.
“if the parties have agreed in writing that
an action on a controversy shall be
brought only in another state and it is
brought in a court of this state, the court
will dismiss or stay the action . . . unless:
I. The court is required by statute to
entertain the action;
II.
The plaintiff cannot secure
effective relief in another state. . . .
III.
The other state would be
substantially less convenient place for
the trial . . .
IV. The agreement as to the place of
the action was obtained by
misrepresentation, duress, the abuse of
economic
power,
or
other
unconscionable means; or
Waiver of Statutory Rights
The New Hampshire courts have not
considered the question of statutory waiver in
the context of civil proceedings.
-3-
December 2006
THIS STATE LAW SURVEY IS BEING PROVIDED TO INSUREDS OF NUCLEAR ELECTRIC INSURANCE
LIMITED FOR INFORMATIONAL USE ONLY AND NOT AS LEGAL ADVICE, OR AS AN OPINION OF LAW. IT IS
SIMPLY AN INDICATION OF WHAT GENERAL RESEARCH SUGGESTS IS THE RELEVANT LAW. NO PARTY
SHOULD RELY ON THE FOLLOWING INFORMATION IN MAKING DECISIONS AS TO LEGAL ISSUES.
ENDNOTES
1
In light of the exemptions in § 406-B:16, an insurer that issues policies to an industrial
insured is not subject to the pre-answer security provision. According to the statute,
transactions involving industrial insureds are exempt from the unauthorized insurance
provisions of Chapter 406B. N.H. REV. STAT. ANN. § 406-B:16. The pre-answer security
requirement in § 406-B:6 would appear to be an unauthorized provision under Chapter
406B.
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