§ 58-30-130 — Restrictions on managing general agents.

A managing general agent may not: (1) Bind reinsurance or retrocessions on behalf of the insurer, except that the managing general agent may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers with which automatic agreements are in effect, the coverages and amounts or percentages that may be reinsured and commission schedules; (2) Commit the insurer to participate in insurance or reinsurance syndicates; (3) Appoint any insurance producer without assuring that the insurance producer is lawfully licensed to transact the type of insurance for which the insurance producer is appointed; (4) Without prior approval of the insurer, pay or commit the insurer to pay a claim over a specified amount, net of reinsurance, which may not exceed one percent of the insurer's policyholder's surplus as of December thirty - first of the last completed calendar year; (5) Collect any payment from a reinsurer or commit the insurer to any claim settlement with a reinsurer, without prior approval of the insurer. If prior approval is given, a report shall be promptly forwarded to the insurer; (6) Permit its subagent to serve on the insurer's board of directors; (7) Jointly employ an individual who is employed with the insurer; or (8) Appoint a submanaging general agent.

Legislative History

SL 1992, ch 353, § 7; SL 2001, ch 286, § 190.