Wisconsin Administrative Code › Office of the Commissioner of Insurance › Chapter Ins 47 - Reinsurance intermediary regulation › Section Ins 47.06 - Required contract provisions-reinsurance intermediary-manager

Current through June 24, 2024
No reinsurance intermediary-manager or reinsurer may enter into
				an agreement or arrangement, or amend or renew an agreement or arrangement,
				after August 1, 1993 for the reinsurance intermediary-manager to represent the
				reinsurer, or continue an agreement or arrangement in effect on August 1, 1993
				after September 30, 1994, unless the agreement or arrangement is a written
				contract which specifies the responsibilities of each party and complies with
				this section, the reinsurance intermediary-manager complies with the contract,
				and the contract is approved by the reinsurer's board of directors, is filed
				with the commissioner for approval at least 30 days before the reinsurer
				assumes or cedes business through the reinsurance intermediary-manager, and the
				commissioner approves the contract. The contract shall specify the
				responsibilities of the reinsurance intermediary-manager, including, but not
				limited to, the following:
(1) The
			 reinsurer may terminate the contract for cause upon written notice to the
			 reinsurance intermediary-manager. The reinsurer may immediately suspend the
			 authority of the reinsurance intermediary-manager to assume or cede business
			 during the pendency of any dispute regarding the cause for
			 termination.
(2) The reinsurance
			 intermediary-manager will render accounts to the reinsurer accurately detailing
			 all material transactions, including received by, or owing to the reinsurance
			 intermediary-manager, and remit all funds due under the contract to the
			 reinsurer on not less than a monthly basis.
(3) All funds collected for the reinsurer's
			 account will be held by the reinsurance intermediary-manager in a fiduciary
			 capacity in a qualified United States financial institution. The reinsurance
			 intermediary-manager may retain no more than 3 months estimated claims payments
			 and allocated loss adjustment expenses. The reinsurance intermediary-manager
			 shall maintain a separate financial institution account for each reinsurer that
			 it represents.
(4) For at least 10
			 years after expiration of each contract of reinsurance transacted by the
			 reinsurance intermediary-manager, the reinsurance intermediary-manager will
			 keep a complete record for each transaction showing:
(a) The type of contract, limits,
			 underwriting restrictions, classes or risks and territory;
(b) Period of coverage, including effective
			 and expiration dates, cancellation provisions and notice required of
			 cancellation, and disposition of outstanding reserves on covered
			 risks;
(c) Reporting and settlement
			 requirements of balances;
(d) Rate
			 used to compute the reinsurance premium;
(e) Names and addresses of
			 reinsurers;
(f) Rates of all
			 reinsurance commissions, including the commissions on any retrocessions handled
			 by the reinsurance intermediary-manager;
(g) Related correspondence and
			 memoranda;
(h) Proof of
			 placement;
(i) Details regarding
			 retrocessions handled by the reinsurance intermediary-manager, as permitted
			 under s.
			 Ins
			 47.08(4), including the identity of
			 retrocessionaires and percentage of each contract assumed or ceded;
(j) Financial records, including but not
			 limited to, premium and loss accounts; and
(k) When the reinsurance intermediary-manager
			 places a reinsurance contract on behalf of a ceding insurer:
1. Directly from any assuming reinsurer,
			 written evidence that the assuming reinsurer has agreed to assume the risk;
			 or
2. If placed through a
			 representative of the assuming reinsurer, other than an employe, written
			 evidence that the reinsurer has delegated binding authority to the
			 representative.