The Office of General Counsel issued the following informal opinion on March 1, 2001, representing the position of the New York State Insurance Department.
Re: Reinsurance Intermediary
Question Presented:
Does N.Y. Ins. Law § 2101(f) (McKinney 2001) require an insurance agent who is licensed in New York to sell life and accident and health insurance, to obtain a reinsurance intermediary license in order to act as an intermediary for reinsurance?
Conclusion:
No, however, the insurance agent may only place reinsurance on business that he/she produced or managed pursuant to the reinsurance intermediary exception found in N.Y. Ins. Law § 2101(f)(3) (McKinney 2001).
Facts:
No specific facts relating to this inquiry were given.
Analysis:
N.Y. Ins. Law § 2101(f) (McKinney 2000) defines "reinsurance intermediary" to mean:
[A]ny person, firm, association or corporation who acts as broker in soliciting, negotiating or procuring the making of any reinsurance contract or binder, or acts as an agent in accepting any reinsurance contract or binder on behalf of an insurer . . .
Section 2101(f) lists the following exceptions to the reinsurance intermediary licensing requirement. These are:
licensed attorneys at law of this state acting in their professional capacity as such;
regular salaried officers, employees or attorneys in fact of an authorized insurer or of an underwriting office of such insurer while acting in their capacity as such in discharging the duties of their employment or appointment;
licensed insurance agents acting within the scope of their agency authority in the placement or acceptance of reinsurance on risks produced or managed by such agents; or
licensed insurance brokers, in the placement of reinsurance on risks produced by such brokers.
Therefore, insurance agents acting within the scope of their agency authority in the placement or acceptance of reinsurance on risks produced or managed by that individual agent, do not need to obtain a reinsurance intermediary license. However, licensed agents are required to obtain a separate reinsurance intermediary license before they engage in a general reinsurance intermediary business unrelated to the risks that they produce or manage.
The application procedure for obtaining a reinsurance intermediary license is contained in N.Y. Ins. Law § 2106 (McKinney 2000).
For further information, you may contact Attorney Meredith S. Kaufer at the New York City Office.