Service of notices, orders, processes, determinations and other documents required or permitted to be served under these rules may be effected as follows:

(a) Upon the Secretary. By personal delivery at the office, or by registered or certified mail addressed to the office of any of the following officials in the Office of Intrastate Land Sales Registration: Administrator; Deputy Administrator; Assistant Deputy Administrator; Director, Examination Division; or Director, Administrative Proceedings Division.

(b) Upon any other person. By delivery of a copy of the documents to the person to be served wherever he may be found, or by leaving such copy at his office or place of business with a person apparently in charge thereof, or, if there is no one in charge or if the office is closed or if he has no office, by leaving a copy at his residence with some person of suitable age and discretion then residing therein, or by sending a copy by registered or certified mail, return receipt requested, addressed to the person at his last known residence, or at his or its last known principal office or place of business. If the address of the residence, principal office, or place of business is unknown and cannot with due diligence be ascertained, service by mail may be made to any office at which the person to be served is known to be employed.

(c) Service on corporations, partnerships, associations, other entities. Service may be made upon any corporation, partnership, business association or other entity by serving any officer, director, partner, trustee, agent for service or managing agent thereof. A managing agent, within the meaning of this subsection, is an agent having the principal managerial responsibility in connection with the regular operation of a distinct office or activity of the enterprise.

(d) Service through attorney. When a person other than the Secretary and his staff shall have appeared of record in a proceeding, generally or specially, by attorney, all subsequent services of notices, orders, processes, and other documents in connection with such proceeding may be made upon such person by

serving the attorney, except that subpoenas and other orders by which such person may be brought in contempt shall be served upon him by one of the methods described in paragraphs (b) and (c) of this section. In any case, copies of documents not served by serving such attorney shall be promptly sent to him; but service on such person shall be effective without proof that copies so sent were received.

(e) Proof of service. Proof of service shall not be required unless the fact of service is seasonably put in issue by appropriate motion or objection on the part of the person allegedly served or other party. In such cases, service may be established by written admission signed by or on behalf of the person to be served, or may be established prima facie by affidavit or certificate of service or mailing, as appropriate. When service is by registered or certified mail, it is complete upon delivery of the document by the post office.

Subpart F-Interstate Land Sales Board and Appeals Officers

§ 1720.500

Functions of the Interstate Land Sales Board and appeals officers. There is hereby established within the Department of Housing and Urban Development an Interstate Land Sales Board, the members of which are designated as appeals officers and may be appointed from time to time by the Secretary. The functions, powers, and responsibilities delegated to an appeals officer designated from the Board as the authorized representative of the Secretary shall be to hear, consider and determine fully and finally appeals from decisions made pursuant to the rules in this part by administrative law judge and to conduct hearings pursuant to 15 U.S.C. 1715. § 1720.510 Composition of the Interstate Land Sales Board.

The Board shall consist of four (4) appointed employees of the Department of Housing and Urban Development designated as appeals officers, other than employees in the Office of Interstate Land Sales Registration. An appeals officer on the Board shall be available at all times for the hearing of each appeal. Records of proceedings before an appeals officer shall be kept by a Secretary to the Board who shall be an employee of the Office of General Counsel.

§ 1720.520 Decisions of appeals officer.

A decision of an appeals officer shall be considered the final action on behalf of the Secretary on matters properly before such officer pursuant to the rules in this part.

§ 1720.525

Reconsideration of final de

cision of appeals officer.

Any hearing for reconsideration pursuant to § 1720.405 of this part shall be heard by any three of the four appeals

officers who shall sit in review as the Interstate Land Sales Board.

§ 1720.530 Department representative.

In each case being heard before an administrative law judge or an appeals officer, pursuant to this part, the Department shall be represented by a Department hearing attorney. The General Counsel shall designate one or more attorneys under his jurisdiction to act as Department hearing attorneys.

1905.6 1905.7

1905.8

Insurer participation and placement program.

Inspections and applications for in

surance.

Deemer or binder requirement. Placement action after inspection report.

Prohibition of unnecessary reinspections.

1905.9 Notice of cancellation or nonrenewal

1905.10 Impartial selection of adjusters. 1905.11 Coding and reports under the Plan. 1905.12 Inapplicability and waiver of regulations.

1905.13 Notice to policyholders.

AUTHORITY: The provisions of this Part 1905 issued under sec. 7(d), 79 Stat. 670; 42 U.S.C. 3535(d); sec. 1103, 82 Stat. 566; 12 U.S.C. 1749bbb-17.

SOURCE: The provisions of this Part 1905 appear at 36 F.R. 24751, Dec. 22, 1971, unless otherwise noted.

§ 1905.1

Definitions.

As used in this part

(a) "Act" means the Urban Property Protection and Reinsurance Act of 1968, codified as title XII of the National Housing Act (12 U.S.C. 1749bbb-1749 bbb-21), which authorized the program. Section references are to the National Housing Act;

(b) "Administrator" means the Federal Insurance Administrator within the Department of Housing and Urban Development, to whom the Secretary has delegated the administration of the program (34 F.R. 2680, Feb. 27, 1969);

(c) "Applicant" means any property owner, or his authorized representative, who duly requests essential property insurance for a risk eligible under a FAIR Plan;

(d) "Binder" means a temporary and preliminary contract of insurance to protect owner against loss from the occurrence of an insurable event before a policy is issued;

(e) "Deemer provision" means a provision in a Plan whereby interim coverage for an eligible risk is deemed

automatically to attach upon the expiration of a specified period of time after an application for inspection and insurance;

(f) "Eligible property," "eligible risk,” or "risk eligible under the Plan" means any real property, personal property, or mixed real and personal property, potentially insurable under one or more lines of essential property insurance, subject to an inspection to ascertain insurability and applicable premium rates;

(g) "Environmental hazard" means any hazardous condition that might give rise to loss under an insurance contract, but which is beyond the control of the property owner or tenant;

(h) "Essential property insurance" means insurance against direct loss to property as defined and limited in standard fire policies and extended coverage endorsement thereon, as approved by the State insurance authority, and insurance against the perils of vandalism and malicious mischief. Such insurance shall not include automobile insurance and shall not include insurance on such type of manufacturing risks as may be excluded by the State insurance authority;

(1) "FAIR Plan" or "Plan" means statewide Plan to assure "fair access to insurance requirements" that is approved by the Administrator as meeting the criteria of Part A of the Act, including such modifications thereof as the Administrator may promulgate from time to time under this part in accordance with subsection 1214(b) of the Act (12 U.S.C. 1749bbb-6(b));

(j) "Inspection facility," with respect to any State, means any rating bureau or other person duly authorized and designated to perform inspections under a Plan:

(k) "Insurer" includes any property insurance company, or group of companies under common ownership or common management, authorized to engage in the insurance business under the laws of at least one State;

(1) "Participating insurer" means any insurer eligible for membership in a Plan and fully participating in that Plan. The term shall not include any insurer in any State in any year in which such insurer does not participate in the Plan on a

risk-bearing or potentially risk-bearing basis;

(m) "Person" includes any individual, group of individuals, corporation, partnership, association, or any other organized group of persons;

(n) "Placement facility" means the facility established under a Plan to place or provide essential property insurance to persons making application for one or more lines of such insurance under the Plan;

(o) "Pool" means any pool or association of insurance companies in any State that is formed, associated, or otherwise created for the purposes of sharing risks and of making property insurance more readily available;

(p) "Property owner" or "owner," with respect to any real property, personal property, or mixed real and personal property, means any person having an insurable interest in such property;

(q) "Secretary" means the Secretary of Housing and Urban Development;

(r) "State" means the several States, the District of Columbia, the Commonwealth of Puerto Rico, the territories and possessions, and the Trust Territory of the Pacific Islands;

(s) "State insurance authority" means the person having legal responsibility for regulating the business of insurance within a State;

(t) "Surcharge" means (1) any condition charge, and (2) any general or other charge added to the basic insurance rates or premium ordinarily applicable to the same class of property; but does not include specific rates that apply to all property in a Plan on the basis of actual self-rating experience;

(u) "Urban area" includes any municipality or other political subdivision of a State, subject to population or other limitations defined in rules and regulations of the Secretary, and such additional areas as may be designated by the State insurance authority; and

(v) "Year" means a calendar year; fiscal year of a company, association, or pool; reinsurance contract year; or such other period of 12 months as may be designated by the Administrator.

§ 1905.2 Composition and supervision of FAIR Plan.

(a) The Administrator will periodically review each State's FAIR Plan in its entirety for conformity to statutory criteria (12 U.S.C. 1749bbb-3-1749bbb-6) and this part. Although the number and

location of the required elements in a Plan will vary according to the particular method and procedures used by the State, the required documentation comprising each Plan could include any or all of the following, as relevant:

(1) The State law, where one has been enacted;

(2) The industry agreement or program, if any;

(3) The approval action by the State insurance authority with respect to the industry agreement or program, or by court order or other approval authority, if applicable; and

(4) Implementing rules, regulations, and orders, together with operating procedures and forms.

(b) The Plan shall include a certification by the State insurance authority of the date on which the Plan was placed in effect and on which any amendments to the Plan are effective.

(c) The Plan shall evidence that it has been approved by, and is to be administered under the supervision of, the State insurance authority.

(d) The Plan shall provide for a continuing public education program by participating insurers, agents, and brokers, in order to assure that the Plan receives adequate public attention. For example, a brochure or other publication should be made widely available for distribution through all agents, brokers, and other producers. All participating insurers, agents, and brokers should include such a publication with each notice of cancellation or nonrenewal in order to provide policyholders with the required information concerning the placement of insurance under the Plan.

(a) At a minimum, the Plan shall provide for insurance against direct loss to property as defined and limited in standard fire policies and in (1) extended coverage, and (2) vandalism and malicious mischief endorsements thereon, as approved by the State insurance authority. It shall not include automobile insurance nor such types of manufacturing risks as may be excluded by the State insurance authority. The Plan shall specifically provide for insurance against direct loss to property that is being constructed or rehabilitated (including builder's risk coverage). To avoid the need for amendment to the Plan and delays in securing new approval action, the Plan should