Any reinsurance intermediary must file and maintain a bond with the commissioner for the protection of all insurers represented or file and maintain an errors and omissions policy, meeting the following criteria.
- (1) The bond must be executed by the reinsurance intermediary as principal and by a surety company authorized to do business in this state, as surety, or surplus lines insurer eligible in this state, in the principal sum of $100,000 for a broker and in the principal sum of $250,000 for a manager, payable to the Texas Department of Insurance for the use and benefit of all insurers represented. The bond must provide that a copy of any cancellation or nonrenewal notice shall be mailed to the Deputy Commissioner for Licensing, Texas Department of Insurance, Mail Code 105-5A, 333 Guadalupe Street, P.O. Box 149104, Austin, Texas 78714-9104. The executed bond must be furnished to the Texas Department of Insurance.
- (2) The errors and omissions policy shall be in a form acceptable to the Texas Department of Insurance, and shall be filed with the deputy commissioner for licensing of the department at the address listed in paragraph (1) of this section. The policy must provide that the Texas Department of Insurance shall be a certificate holder and shall receive a copy of any cancellation or nonrenewal notice, which shall be mailed to the deputy commissioner for licensing at the address listed in paragraph (1) of this section. The errors and omissions policy shall cover all negligent acts or omissions of the reinsurance intermediary and any person acting on its behalf and shall provide coverage of at least $100,000 for each occurrence for brokers and shall provide coverage of at least $250,000 for each occurrence for managers.
- (3) The commissioner may determine that special circumstances require an additional amount of coverage for the bond or policy.
Source Note:The provisions of this §19.1403 adopted to be effective April 13, 1992, 17 TexReg 2276.