§ 4823. Other requirements of managing general agents and reinsurance intermediaries
(a) Managing general agents and reinsurance intermediaries shall not:
(1) commit the insurer or reinsurer to participate in insurance or reinsurance syndicates;
(2) appoint any producer without assuring that the producer is lawfully licensed to transact
the type of insurance for which he or she is appointed;
(3) pay or commit the insurer to pay a claim, net of reinsurance or retrocessions, that
exceeds one percent of the insurer’s or reinsurer’s policyholders’ surplus as of December
31 of the last completed calendar year without prior approval of the insurer or reinsurer;
(4) collect any payment from a reinsurer or retrocessionaire or commit the insurer or
reinsurer to any claim settlement with a reinsurer or retrocessionaire without prior
approval of the insurer or reinsurer. If prior approval is given, a report must be
promptly forwarded to the insurer or reinsurer;
(5) permit its subproducer to serve on the insurer’s board of directors;
(6) jointly employ an individual who is employed with the insurer or reinsurer unless
such reinsurance intermediary-manager is under common control with the reinsurer subject
to chapter 101, subchapter 13 of this title;
(7) appoint a sub-managing general agent or sub-reinsurance intermediary-manager; or
(8) pay interim profits until one year after the end of each underwriting period for property
business and five years after the end of each underwriting period for casualty business,
or a later period set by the Commissioner for specified lines of insurance, and not
until the adequacy of reserves on remaining claims has been verified pursuant to subdivision 4819(a)(2) or 4819(c)(3) of this title, if the managing general agent or reinsurance intermediary set reserves.
(b) The reinsurance intermediary shall:
(1) disclose in writing to the insurer any relationship with the ceding or assuming insurer
and the rates, terms, and purposes of commissions, charges, and other fees that the
reinsurance intermediary-manager may levy against the reinsurer; and
(2) provide the reinsurer with a statement of its financial condition.
(c) The acts of the reinsurance intermediary-manager shall be deemed to be the acts of
the reinsurer on whose behalf it is acting within the scope of its actual or apparent
authority. (Added 1991, No. 249 (Adj. Sess.), § 18, eff. Jan. 1, 1993.)