Service of Process
What Does the Department of Insurance Do?
- Under Section 38-5-70 of the South Carolina Code, the Director of Insurance is the legal agent for service of process on insurance companies, eligible surplus lines insurers, approved reinsurers, purchasing groups, risk retention groups, and health maintenance organizations (HMOs).
- The Director's authority extends only to actions filed within the State of South Carolina. Service upon the Director as agent for insurance companies is the exclusive means of service, and service upon an insurer made in any other way is invalid unless another means of service is specified within the policy. See Equilease Corp.v. Weathers, 275 S.C. 478, 484, 272 S.E.2d 789, 792 (1980). The Director's role as statutory agent for service of process continues even after the insurer's charter has been surrendered, canceled or revoked.
- Where an insurer not licensed by the Director transacts business in this State, such unauthorized transaction of business constitutes the appointment of the Director as the insurer's statutory agent for service in any suits arising out of insurance contracts made by the insurer.
Uninsured (UM) / Underinsured (UIM)
Service of notice of an UM / UIM claim under a policy is not really service of "process." However, South Carolina law requires that these notices be served as if one were actually serving process on the insurance company, so the process is virtually identical. UM / UIM notices must be served separately. To protect South Carolina's insured, the Director does accept service of notices in cases filed outside of South Carolina.
What Does the Department of Insurance Not Do?
- The Director is authorized to accept only service of "process." The Director is not the general agent of record of insurers, and he is not authorized to accept service of discovery or other legal documents once service in a case has been successfully served. Instead, serve these items directly upon the attorney of record for the insurer as required by Rule 5(b)(1) of the South Carolina Rules of Civil Procedure. The Rules allow service of discovery documents with a Summons and Complaint, and the Department will accept service of discovery documents only in that case.
- The Director is not authorized to accept service on behalf of self-insured entities. He is not authorized to accept service on behalf of corporate holding companies, insurance agencies, adjusting firms, premium service companies, third-party administrators, individuals or other non-insurance company entities.
- The Director cannot accept service upon a defendant's liability insurer unless that insurer is actually named as a party to the suit being brought. Notice of filing a suit is made on a defendant's liability carrier through proper service on the defendant. It also can be mailed directly to the defendant's carrier without involving the Director or the Department of Insurance.
What Must I Do?
- Mail or deliver service of process on the Director in his capacity as agent for service of process. Our physical and mailing addresses are shown to the right under Contact Us.
- Furnish two copies of the Summons and Complaint, and anything else you wish to have served, to the Director for each insurer served per UM / UIM notice. For example, if two insurers are being sued in the same action, four copies of the process (two per company) must be supplied. Please make sure the Summons and Complaint are properly signed and reflects the civil action number of the case as required by Rule 4 of the South Carolina Rules of Civil Procedure.
- Please make sure the proper service of process fee accompanies any process delivered to the Director. The statutory fee is $10 for each insurer served. For example, if two insurers are being sued in the same action, $20 ($10 per company) must be remitted. Checks should be made payable to the South Carolina Department of Insurance.
- Fully, clearly and correctly identify the insurer to be served. Although insurers are required to transact business in their proper or corporate name, many insurers have quite similar names. For example, the Director of Insurance should not be requested simply to serve "State Farm." Licensed members of the State Farm group of companies include State Farm Mutual Automobile Insurance Company, State Farm Fire and Casualty Company, State Farm General Insurance Company, State Farm Life Insurance Company and State Farm Health Insurance Company. The precise name of the insurer should be listed on the declarations page of the policy.
- Notify the Director by cover letter or otherwise if the case is UM or UIM and remember these notices must be served separately.