(a)No domestic insurer shall make any contract in which
any person is granted or is to enjoy in fact the management of
the insurer to the substantial exclusion of its board of
directors, or to have the controlling or preemptive right to
produce substantially all insurance business for the insurer,
or, if an officer, director or otherwise part of the insurer's
management, is to receive any commission, bonus or compensation
based upon the volume of the insurer's business or transactions,
unless the contract is filed with and approved by the
commissioner. The contract is approved unless disapproved by the
commissioner within twenty (20) days from the date of filing,
subject to any reasonable time extension the commissioner
requires by notice given within the twenty (20) days. Any
disapproval
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(a) No domestic insurer shall make any contract in which
any person is granted or is to enjoy in fact the management of
the insurer to the substantial exclusion of its board of
directors, or to have the controlling or preemptive right to
produce substantially all insurance business for the insurer,
or, if an officer, director or otherwise part of the insurer's
management, is to receive any commission, bonus or compensation
based upon the volume of the insurer's business or transactions,
unless the contract is filed with and approved by the
commissioner. The contract is approved unless disapproved by the
commissioner within twenty (20) days from the date of filing,
subject to any reasonable time extension the commissioner
requires by notice given within the twenty (20) days. Any
disapproval shall be delivered to the insurer in writing,
stating the grounds for the disapproval.
(b) Any contract specified in subsection (a) of this
section shall provide that any manager or producer of its
business, within ninety (90) days after expiration of each
calendar year, shall furnish the insurer's board of directors a
written statement of amounts received under or on account of the
contract and amounts expended thereunder during the calendar
year, including the emoluments received therefrom by the
directors, officers and other principal management personnel of
the manager or producer, and with any classification of items
and further detail as the insurer's board of directors
reasonably requires.
(c) The commissioner shall disapprove any contract
specified in this section if he finds that it:
(i) Subjects the insured to excessive charges;
(ii) Is to extend for an unreasonable length of time;
(iii) Does not contain fair and adequate standards of
performance; or
(iv) Contains other inequitable provisions or
provisions which impair the proper interests of stockholders or
policyholders of the insurer.
(d) The commissioner, after a hearing held thereon, may
withdraw his approval of any contract he approved, if he finds
that the basis of his original approval no longer exists, or
that the contract, in actual operation, is subject to
disapproval on any of the grounds referred to in subsection (c)
of this section.
(e) This section does not apply to contracts entered into
prior to January 1, 1968, nor to extensions or amendments to
those contracts.