Section 322.4 - Prohibited ActsAn MGA shall not:
(1) Bind reinsurance or retrocessions on behalf of the insurer except that the MGA may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines, including, for both reinsurance assumed and ceded, a list of reinsurers with which such automatic agreements are in effect, the coverages and amounts or percentages that may be reinsured and the commission schedules.(2) Commit the insurer to participate in insurance or reinsurance syndicates.(3) Appoint any agent without assuring that the agent is lawfully licensed to transact the type of insurance for which he is appointed.(4) Without prior approval of the insurer, pay or commit the insurer to pay a claim over a specified amount, net of reinsurance, which shall not exceed one per centum of the insurer's policyholder's surplus as of December 31 of the last completed calendar year.(5) Collect any payment from a reinsurer or commit the insurer to any claim settlement with a reinsurer without prior approval of the insurer. If prior approval is given, a report must be promptly forwarded to the insurer.(6) Permit its subagent to serve on the insurer's board of directors.(7) Jointly employ an individual who is employed with the insurer.1921, May 17, P.L. 789, No. 285, art. VIII, § 804, added 1992, Dec. 18, P.L. 1469, No. 177, § 12, effective in 120 days.