{"id":13110,"date":"2021-11-11T22:19:00","date_gmt":"2021-11-12T03:19:00","guid":{"rendered":"https:\/\/www.resourcepro.com\/in-good-standing-certificate-of-authority-statuses\/"},"modified":"2024-07-24T12:58:12","modified_gmt":"2024-07-24T16:58:12","slug":"in-good-standing-certificate-of-authority-statuses","status":"publish","type":"post","link":"https:\/\/www.resourcepro.com\/blog\/in-good-standing-certificate-of-authority-statuses\/","title":{"rendered":"In Good Standing: Certificate of Authority Statuses"},"content":{"rendered":"\r\n

Elaine is a Marketing Associate at ReSource Pro Compliance<\/em><\/p>\r\n\r\n\r\n\r\n

Often, insurance businesses operating in a state other than their domicile jurisdiction need to register with the Secretary of State as a foreign corporation. When the process\u2014which is often entirely separate from securing an insurance license\u2014is complete, the SOS issues the entity a Certificate of Authority. This COA documents approval for an entity to transact business in the state.<\/p>\r\n\r\n\r\n\r\n

As with insurance licenses, regulators require registrants to complete certain tasks to prove they are still in compliance with state laws and regulations. For example, the business may need to file annual or biennial returns or submit foreign corporation tax filings. Failing to complete these tasks in a timely manner can impact your Certificate of Authority status.<\/p>\r\n\r\n\r\n\r\n

COA Status Codes<\/h2>\r\n\r\n\r\n\r\n

A quick phone call to the Secretary of State\u2019s Office<\/a> or a check of their website will show an entity\u2019s current COA status. In order to legally do business in a state, the entity\u2019s Certificate of Authority must be In Good Standing\u00a0<\/strong>. This status code means that the business registered properly and completed all required compliance tasks in a timely manner.<\/p>\r\n\r\n\r\n\r\n

There are other status codes that may or may not indicate a problem requiring immediate action. (Please note that the exact terminology used for statuses can vary from state to state.)<\/em><\/p>\r\n\r\n\r\n\r\n

Dissolved or Withdrawn<\/h2>\r\n\r\n\r\n\r\n

These statuses indicate that an entity ceased doing business in the state and voluntarily surrendered its Certificate of Authority. The term \u201cdissolved\u201d is used for domestic entities, while \u201cwithdrawn\u201d applies to entities domiciled in another state.<\/p>\r\n\r\n\r\n\r\n

Merged or Merged Out<\/h2>\r\n\r\n\r\n\r\n

These statuses indicate that an entity no longer exists as an active business due to a merger.<\/p>\r\n\r\n\r\n\r\n

Converted<\/h2>\r\n\r\n\r\n\r\n

This status indicates that an entity changed its business structure or relocated to a different jurisdiction of domestication.<\/p>\r\n\r\n\r\n\r\n

Obviously, these statuses are all the result of actions intentionally taken by the business entity with the approval of the SOS. They carry no negative consequences, so registrants don\u2019t need to take further action.<\/p>\r\n\r\n\r\n\r\n

It\u2019s a different matter for the last status.<\/p>\r\n\r\n\r\n\r\n

Inactive<\/h2>\r\n\r\n\r\n\r\n

A wide variety of terms may be used to reflect an inactive certification of authority. These include: Involuntarily<\/strong> or Administratively Dissolved, Suspended, Forfeited, Revoked,<\/strong> or Inactive<\/strong>. Each term reflects a slightly different set of circumstances, but they all have one thing in common. If your COA shows any of these statuses, you are no longer eligible to do business within the jurisdiction.<\/p>\r\n\r\n\r\n\r\n

There are a number of ways a business can lose its good standing unintentionally. Some of the most common causes include:<\/p>\r\n\r\n\r\n\r\n