Can an Illinois Insurance Agent Pay Card Transaction Costs from their PFTA

Illinois and Insurance Premium Trust Accounts

In Illinois insurance premium payments accepted by the agent must be deposited into a PFTA - premium trust account.

Here is the link to the relevant law...

ftp://www.ilga.gov/jcar/admincode/050/050031130000400R.html

If the premium payment is accepted as a debit or credit card payment, is it legal for there to be a withdrawal from your agency PFTA account to pay the transaction cost of those premium payments?

Probably not. Read on....

Limitations of Withdrawals

Here are the things for which you are allowed to withdraw funds from the PFTA.

"Withdrawals can be made for the following reasons:

h)         The following disbursements may be lawfully withdrawn from the PFTA:

1)         Net or gross premium remittances due other licensees or insurers. Claims payments or reinsurance premiums when offset at the direction of the insurer may be transferred to another account;

2)         Return premiums due insureds;

3)         Commissions due the licensee, net of any financial institution fees or service charges, or commissions due another licensee only when the commission withdrawal is matched and identified with premiums previously deposited into the PFTA;

4)         Non-premium monies when matched and identified with prior non-premium PFTA deposits;

5)         Interest or other revenue which the licensee is authorized to retain.

6)         Withdrawals pursuant to subsections (h)(3), (4) and (5) must be made payable to the licensee or another licensee."

I look at this like a named peril insurance policy as opposed to an all-risk insurance policy. If the action is not specifically allowed, then the action is not allowed.

Under this list of reasons I see no permission to withdraw funds to pay the transaction cost to the bank for you credit and debit card payments.

What do you think?