Reinsurance Intermediary Manager
A Reinsurance Intermediary Manager is a person who has authority to bind or manage all or part of the assumed reinsurance of a reinsurer and acts as an agent for the reinsurer whether known as a manager or other similar term. The term includes the manager of a separate division, department or underwriting office who acts as an agent for a reinsurer.
The following persons are not managers with respect to a reinsurer:
An employee of the reinsurer;
A manager of a branch of an alien reinsurer located in the United States;
An underwriting manager who, pursuant to a contract, manages all or part of the reinsurance of the reinsurer, is under common control with the reinsurer within the meaning of chapter 692C of NRS, and whose compensation is not based on the volume of premiums written; or
The manager of a group, association, pool or organization of insurers who engage in joint underwriting or joint reinsurance and who are subject to examination by the commissioner of the state in which the principal business office of the manager is located.
License Required
A person shall not act as a Reinsurance Intermediary Manager unless licensed as a producer or a Reinsurance Intermediary in this state pursuant to NRS 681A.420.
A license issued to a firm or association authorizes all of the members of the firm or association and any designated employees to act as intermediaries. Those persons must be named in the application and the supplemental documents (Biographical Affidavit) provided at the time of application.
A license issued to a corporation authorizes all of the officers and any designated employees and directors of the corporation to act as intermediaries on behalf of the corporation. Those persons must be named in the application and the supplemental documents (Biographical Affidavit) provided at the time of application.
License Term
A license as a Reinsurance Intermediary Manager is valid for three years from the date of issuance.
Fees
All fees paid to the Nevada Division of Insurance are nonrefundable.
Initial Application total: $185
This fee consists of the $60 Administration and Enforcement fee and the $125 licensing fee.
Triennial Renewal total: $185
This fee consists of the $60 Administration and Enforcement fee and the $125 licensing fee.
How to Apply
An applicant for a license as a Reinsurance Intermediary Manager must:
Submit a paper application to the Division’s Carson City Office;
Comply with all requirements of NRS 681A.250 to 681A.580, inclusive;
Remit any applicable fees
A Reinsurance Intermediary Manager shall file a bond of not less than $50,000 for each reinsurer represented pursuant to NAC 681A.080. To file a bond, please fill out the Reinsurance Intermediary Manager Bond Form and submit with application.
A Reinsurance Intermediary Manager shall maintain an insurance policy of not less than $1,000,000 covering errors and omissions pursuant to NAC 681A.090.
Pursuant to NAC 681A.100, a nonresident Reinsurance Intermediary Manager may satisfy the bonding and errors and omissions requirements by submitting evidence that the bonds and insurance policy are filed with the appropriate regulatory officer of the state in which the intermediary is domiciled.
If a nonresident, the applicant shall:
Designate the Commissioner as agent for service of process;
Furnish the Commissioner with the name and address of a resident of Nevada upon whom notices or orders of the Commissioner or process affecting the nonresident reinsurance intermediary may be served; and
Promptly notify the Commissioner in writing of every change in the applicant’s designated agent for service of process. The change is not effective until acknowledged by the Commissioner.
How to Renew
A license as a Reinsurance Intermediary Manager may be renewed by:
Submitting a paper renewal application to the Division’s Carson City Office;
Remitting any applicable fees.
Payments may be made by check, money order or Electronic Funds Transfer (EFT). Please make checks and money orders payable to the Nevada Division of Insurance. Please contact the Accounting Section at ifn@doi.nv.gov to request the required EFT form.
Additional Requirements
Pursuant to NRS 681A.490:
Transactions between a manager for reinsurance and the reinsurer he or she represents must only be entered into pursuant to a written contract which specifies the responsibilities of each party and is approved by the board of directors of the reinsurer. At least 30 days before a reinsurer assumes or cedes insurance, a copy of the contract must be filed with the Commissioner for approval.
The reinsurer may terminate the contract for cause upon written notice to the manager for reinsurance and the reinsurer may suspend the authority of the manager for reinsurance to assume or cede insurance during the pendency of any dispute regarding the cause for termination.
The manager for reinsurance shall:
Render accounts to the reinsurer accurately detailing all material transactions, including information necessary to support all commissions, charges and other fees received by or owing to him or her; and
Remit all money due pursuant to the contract to the reinsurer monthly.
All money collected for the account of the reinsurer must be held by the manager for reinsurance, in a fiduciary capacity, in a bank or credit union which is a qualified financial institution. The manager for reinsurance may retain no more than the total of 3 months’ estimated payments on claims and allocated expenses of adjusting losses. The manager for reinsurance shall maintain a separate account in a bank or credit union for each reinsurer that he or she represents.
The contract must not be assigned in whole or in part by the manager for reinsurance.
Pursuant to NRS 681A.500:
A manager for reinsurance shall comply with the written underwriting and rating standards established by the insurer he or she represents for the acceptance, rejection or cession of all risks.
The contract must set forth the rates, terms and purposes of commissions, charges and other fees which the manager for reinsurance may levy against the reinsurer.
The manager for reinsurance shall annually provide the reinsurer with a statement of the financial condition of the manager for reinsurance prepared by an independent certified public accountant.
The reinsurer shall conduct a review of underwriting and the handling of claims by the manager for reinsurance at the location of the operations of the manager for reinsurance at least twice each calendar year.
The manager for reinsurance shall disclose to the reinsurer any relationship the manager for reinsurance has with an insurer before ceding or assuming insurance to or from the insurer pursuant to the contract.
The acts of the manager for reinsurance shall be deemed to be the acts of the reinsurer on whose behalf the manager for reinsurance is acting.
Pursuant to NRS 681A.510:
If a contract between a manager for reinsurance and the reinsurer he or she represents permits the manager for reinsurance to settle claims on behalf of the reinsurer:
All claims must be reported to the reinsurer in a timely manner; and
A copy of the claim file must be sent to the reinsurer at its request or as soon as it becomes known that the claim:
Potentially exceeds the amount determined by the Commissioner or the limit set by the reinsurer, whichever is the lesser amount;
Involves a dispute over coverage;
May exceed the authority of the manager for reinsurance to settle claims;
Has been open for more than 6 months; or
Is closed by payment of the lesser of an amount set by the Commissioner or an amount set by the reinsurer.
All claims files are the joint property of the reinsurer and the manager for reinsurance. Upon an order of liquidation of the reinsurer, the files become the sole property of the reinsurer or its estate. The reinsurer or its estate shall allow the manager for reinsurance to have reasonable access to and to copy the files on a timely basis.
The reinsurer may terminate any authority to make settlements granted to the manager for reinsurance for cause upon written notice to him or her or upon the termination of the contract. The reinsurer may suspend the authority of the manager for reinsurance to make settlements during the pendency of the dispute regarding the cause of termination.
Pursuant to NRS 681A.520:
If a contract between a manager for reinsurance and the reinsurer he or she represents provides for a sharing of interim profits by the manager for reinsurance, the interim profits must not be paid until 1 year after the end of each underwriting period for property insurance and 5 years after the end of each underwriting period for casualty insurance, and not until the adequacy of reserves on remaining claims has been verified pursuant to NRS 681A.550.
Pursuant to NRS 681A.530:
For at least 10 years after expiration of each contract of reinsurance transacted by a manager for reinsurance, the manager for reinsurance shall keep a complete record for each transaction, including evidence of:
The type of contract, limits, underwriting restrictions, classes or risks and territory;
The period of coverage, including effective and expiration dates, provisions concerning cancellation and notice of cancellation, and disposition of outstanding reserves on covered risks;
The requirements for reporting and settling balances;
The rate used to compute the reinsurance premium;
The names and addresses of reinsurers;
The rates of all commissions for reinsurance, including the commissions on any retrocessions handled by the manager for reinsurance;
Any related correspondence and memoranda;
Proof of placement;
Any details regarding retrocessions handled by the manager for reinsurance, including the identity of retrocessionaires and percentage of each contract assumed or ceded;
Financial records, including accounts of premium and loss; and
If the manager for reinsurance places a contract of reinsurance on behalf of a ceding insurer:
Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
Through a representative of the assuming reinsurer, other than an employee, written evidence that the reinsurer has delegated binding authority to the representative.
The manager for reinsurance shall allow a reinsurer to have access and to copy all accounts and records maintained by the manager for reinsurance related to its business in a form usable by the reinsurer.
Pursuant to NRS 681A.540:
Except as otherwise provided in this section, cede retrocessions on behalf of the reinsurer. A manager for reinsurance may cede facultative retrocessions pursuant to facultative agreements if the contract with the reinsurer contains guidelines for underwriting the retrocessions. The guidelines must include a list of reinsurers with which automatic agreements are in effect, and for each reinsurer, the coverages and amounts or percentages that may be reinsured, and commission schedules.
Commit the reinsurer to participate in syndicates for reinsurance.
Appoint any producer without verifying that the producer is licensed to transact the type of reinsurance for which the producer is appointed.
Without 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 1 percent of the policyholder’s surplus of the reinsurer as of December 31 of the last complete calendar year.
Collect any payment from a retrocessionaire or commit the reinsurer to any settlement of a claim with a retrocessionaire, without the approval of the reinsurer. If approval is given, the manager for reinsurance shall promptly forward a report to the reinsurer.
Employ a person who is employed by the reinsurer unless the manager for reinsurance is under common control with the reinsurer within the meaning of chapter 692C of NRS.
Appoint another person to act as a manager for reinsurance.
Pursuant to NRS 681A.550:
A reinsurer shall not engage the services of any person to act as a manager for reinsurance on its behalf unless the person is licensed as required by NRS 681A.430.
A reinsurer shall annually obtain a copy of statements of the financial condition of each manager for reinsurance whom the reinsurer has engaged. The statements must be prepared by an independent certified public accountant in a form approved by the Commissioner.
If a manager for reinsurance establishes reserves for losses, the reinsurer shall annually obtain the opinion of an actuary attesting to the adequacy of reserves established for losses incurred and outstanding on the business produced by the manager for reinsurance. The opinion of the actuary must be in addition to any other required certification.
An officer of the reinsurer must have authority to bind a reinsurer for all retrocessional contracts and for participation in syndicates for reinsurance. The officer must not be affiliated with the manager for reinsurance.
At least 30 days before termination of a contract with a manager for reinsurance, the reinsurer shall provide written notification of the termination to the Commissioner.
Except as otherwise provided in chapter 692C of NRS, a reinsurer shall not appoint to its board of directors any officer, director, employee, controlling shareholder or sub-producer of its manager for reinsurance.
All Intermediaries are subject to examination by the Division pursuant to NRS 681A.560.
Legal Authority
Reinsurance Intermediaries are regulated by the provisions of chapter 681A of the Nevada Revised Statutes (NRS) and the chapter 681A of the Nevada Administrative Code (NAC).