Sec. 8. (a) An insurer shall have on file an independent financial examination, in a form acceptable to the commissioner, of each MGA with which it has done business.

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Terms Used In Indiana Code 27-1-33-8

  • actuary: means a person who is a member in good standing of the American Academy of Actuaries. See Indiana Code 27-1-33-1
  • commissioner: refers to the insurance commissioner appointed under IC 27-1-1-2. See Indiana Code 27-1-33-2
  • Contract: A legal written agreement that becomes binding when signed.
  • Insurance: means a contract of insurance or an agreement by which one (1) party, for a consideration, promises to pay money or its equivalent or to do an act valuable to the insured upon the destruction, loss or injury of something in which the other party has a pecuniary interest, or in consideration of a price paid, adequate to the risk, becomes security to the other against loss by certain specified risks; to grant indemnity or security against loss for a consideration. See Indiana Code 27-1-2-3
  • insurer: means any person, firm, association, or corporation duly authorized to act in Indiana as an insurance company pursuant to IC 27-1. See Indiana Code 27-1-33-3
  • MGA: means any person, firm, association, or corporation:

    Indiana Code 27-1-33-4

  • shareholder: means one who is a holder of record of shares of stock in a corporation, unless the context otherwise requires. See Indiana Code 27-1-2-3
     (b) If an MGA establishes loss reserves, the insurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the MGA. This requirement is in addition to any other required loss reserve certification.

     (c) The insurer shall periodically (at least semiannually) conduct an on-site review of the underwriting and claims processing operations of the MGA.

     (d) Binding authority for all reinsurance contracts or participation in insurance or reinsurance syndicates shall rest with an officer of the insurer, who may not be affiliated with the MGA.

     (e) Within thirty (30) days after entering into or terminating a contract with an MGA, the insurer shall provide written notification of the appointment or termination to the commissioner. Notices of appointment of an MGA must include a statement of duties that the applicant is expected to perform on behalf of the insurer, the lines of insurance for which the applicant is to be authorized to act, and any other information the commissioner may request.

     (f) An insurer shall review its books and records each quarter to determine if any producer (as defined by section 4 of this chapter) has become, by operation of section 4 of this chapter, an MGA. If the insurer determines that a producer has become an MGA pursuant to section 4 of this chapter, the insurer shall promptly notify the producer and the commissioner of that determination, and the insurer and producer shall fully comply with the provisions of this chapter within thirty (30) days.

     (g) An insurer shall not appoint to its board of directors an officer, a director, an employee, a subproducer, or a controlling shareholder of its MGAs. This subsection does not apply to relationships governed by IC 27-1-23.

     (h) An insurance holding company system regulated under IC 27-1-23 may perform the obligations imposed by this section for insurers affiliated in the system by submitting, in a form acceptable to the commissioner, consolidated information concerning the MGAs with whom the insurers have done business.

As added by P.L.1-1992, SEC.148. Amended by P.L.116-1994, SEC.45.

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