(a) Except as provided in subdivision (b), a licensed life agent may present a proposal for insurance to a prospective policyholder on behalf of a life insurer for which the life agent is not specifically appointed, and may also transmit an application for insurance to that insurer. If a policy of insurance is issued pursuant to that application, the insurer is considered to have authorized the agent to act on its behalf, and the insurer is responsible for all actions of the agent that relate to the application and policy as if the agent had been duly appointed for the insurer. Not more than 14 days after the life agent submits an application for insurance to the insurer for which the insurer issues a policy, the insurer shall forward to the commissioner a notice of appointment of the life agent as the insurer’s agent in accordance with the requirements of this article. Nothing in this section obliges an insurer to accept an application for underwriting from a life agent. Any payments made by the prospective policyholder prior to issuance of the policy shall be made only in the form of a draft, check, cashier’s check, traveler’s check, money order, or similar instrument made payable to the insurer to which the application is transmitted.

(b) A licensed life agent who is not specifically appointed for a particular life insurer may not (1) present a proposal to a prospective policyholder for insurance with that insurer or (2) transmit an application for insurance to that insurer if the insurer requires all its life agents to represent only that insurer or a group of affiliated insurers of which that insurer is a member or to submit risks to that insurer or group of affiliated insurers prior to submitting them to other insurers.

(Amended by Stats. 1990, Ch. 1420, Sec. 39. Operative January 1, 1992, by Sec. 77 of Ch. 1420.)