Sec. 38a-760g. Reinsurance intermediary-manager: Prohibited practices.

The reinsurance intermediary-manager shall not:

(1) Cede retrocessions on behalf of the reinsurer, except the reinsurance intermediary-manager may cede facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for such retrocessions. Such guidelines shall include a list of reinsurers with which such automatic agreements are in effect, and for each such reinsurer, the coverages and amounts or percentages that may be reinsured, and commission schedules;

(2) Commit the reinsurer to participate in reinsurance syndicates;

(3) Appoint any producer without verifying the producer is 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 per cent 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) Jointly employ an individual who is employed by the reinsurer unless such reinsurance intermediary-manager is under common control with the reinsurer subject to the provisions of sections 38a-129 to 38a-140, inclusive;

(7) Appoint a subreinsurance intermediary-manager.

(P.A. 92-112, S. 29, 35; P.A. 14-235, S. 33.)

History: P.A. 14-235 made a technical change in Subdiv. (5).