§ 33-2-1706 — Prohibited Acts

33-2-1706 . Prohibited acts. A reinsurance intermediary-manager may not:
(1) bind retrocessions on behalf of the reinsurer, except that the reinsurance intermediary-manager may bind facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for retrocessions. The guidelines must include a list of reinsurers with which automatic agreements are in effect and, for each reinsurer, must include the coverages, amounts of percentages that may be reinsured, and commission schedules.
(2) commit the reinsurer to participate in reinsurance syndicates;
(3) appoint any producer without ensuring that the producer is licensed to transact the type of reinsurance for which the producer is appointed;
(4) without prior approval of the reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions, that exceeds the lesser of an amount specified by the reinsurer or 1% of the reinsurer's policyholder's surplus as of December 31 of the last complete calendar year;
(5) collect any payment from a party making a retrocession, or commit the reinsurer to any claim settlement with a party making a retrocession, without prior approval of the reinsurer. If prior approval is given, a report must be promptly forwarded to the reinsurer.
(6) jointly employ an individual who is employed by the reinsurer unless the reinsurance intermediary-manager is under common control with the reinsurer subject to Title 33, chapter 2, part 11;
(7) appoint a subreinsurance intermediary-manager.

Legislative History

En. Sec. 24, Ch. 596, L. 1993.