§ 58-14-35 — Restrictions on agent.

The agent may not: (1) Cede retrocessions on behalf of the reinsurer. However, the agent or broker may cede facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for the retrocessions. The guidelines shall include a list of reinsurers with which automatic agreements are in effect, and for each reinsurer, the coverages and amounts or percentages that may be reinsured, and commission schedules; (2) Commit the reinsurer to participate in reinsurance syndicates; (3) Employing another agent or broker who is not lawfully licensed to transact the type of reinsurance for which he 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 one percent of the reinsurer's policyholder's surplus as of December thirty - first of the last complete calendar year; (5) Collect any payment from a retrocessionaire or commit the reinsurer to any claim settlement with a retrocessionaire, without prior approval of the reinsurer. If prior approval is given, a report shall be promptly forwarded to the reinsurer; (6) Appoint a sub - agent; or (7) Jointly employ an individual who is employed by the reinsurer unless the agent is under common control with the reinsurer subject to chapter 58-5A .

Legislative History

SL 1992, ch 345, § 12.