Section 8-209 - Prohibited activities of managing general agent. - Maryland Statutes

§ 8-209. Prohibited activities of managing general agent.
 

(a)  In general.- A managing general agent may not: 

(1) commit the insurer to participate in insurance or reinsurance syndicates; 

(2) appoint or hire an insurance producer to solicit, procure, or negotiate insurance contracts for the insurer without ensuring that the insurance producer is licensed under Title 10, Subtitle 1 of this article; 

(3) take an action that would violate § 27-503 of this article if taken directly by the insurer; 

(4) without the insurer's written approval, pay or commit the insurer to pay a claim, net of reinsurance, that exceeds 1% of the insurer's policyholder surplus as of December 31 of the immediately preceding calendar year; 

(5) without the insurer's prior written approval, collect any payment from a reinsurer; 

(6) commit the insurer to a claim settlement with a reinsurer; 

(7) employ an individual who also is employed by the insurer; 

(8) allow an agent or employee of the managing general agent to serve on the insurer's board of directors; or 

(9) appoint a submanaging general agent unless: 

(i) approval of the appointment is obtained from the Commissioner and from the insurer for whom the managing general agent acts; and 

(ii) the submanaging general agent complies with any requirements imposed by the Commissioner under § 8-213 of this subtitle. 

(b)  Binding reinsurance or retrocessions.-  

(1) Except as provided in paragraph (2) of this subsection, a managing general agent may not bind reinsurance or retrocessions for an insurer. 

(2) A managing general agent may bind facultative reinsurance contracts under obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines for reinsurance both assumed and ceded, including: 

(i) a list of reinsurers with which the automatic agreements are in effect; 

(ii) the coverages and amounts or percentages that may be reinsured; and 

(iii) commission schedules. 
 

[An. Code 1957, art. 48A, § 669; 1995, ch. 36; 1997, ch. 70, § 1; 2001, ch. 731, § 1.]