Section 8-518 - Restrictions on activities of reinsurance manager. - Maryland Statutes

§ 8-518. Restrictions on activities of reinsurance manager.
 

(a)  In general.- A reinsurance manager: 

(1) except as provided in subsection (b) of this section, may not cede retrocessions for a reinsurer; 

(2) may not commit a reinsurer to participate in reinsurance syndicates; 

(3) may not appoint or hire an insurance producer to solicit, procure, or negotiate reinsurance contracts for a reinsurer without ensuring that the insurance producer is qualified under Title 10, Subtitle 1 of this article; 

(4) may not take an action that would constitute a violation of § 27-503 of this article if taken directly by a reinsurer; 

(5) without the reinsurer's prior written approval, may not pay or commit a reinsurer to pay a claim, net of reinsurance, that exceeds the lesser of 1% of the reinsurer's policyholder surplus as of the preceding calendar year and an amount specified by the reinsurer; 

(6) subject to subsection (b) of this section and without the reinsurer's prior written approval: 

(i) may not collect a payment from a retrocessionaire; or 

(ii) may not commit a reinsurer to a claim settlement with a retrocessionaire; 

(7) may not appoint a subreinsurance manager; or 

(8) may not employ an individual who is also employed by a reinsurer that transacts business with the reinsurance manager, unless the reinsurance manager is under common control with the reinsurer and is subject to Title 7 of this article. 

(b)  Facultative agreements.- A reinsurance manager may cede facultative reinsurance contracts under obligatory facultative agreements if the contract between the reinsurance manager and reinsurer contains reinsurance underwriting guidelines for the retrocessions, including: 

(1) a list of reinsurers with which any automatic agreements are in effect; 

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

(3) commission schedules. 
 

[An. Code 1957, art. 48A, § 731; 1995, ch. 36; 1997, ch. 70, § 1; 2001, ch. 731, §§ 1, 9; 2002, ch. 19, § 5.]