A. No domestic insurer shall make, amend or renew any contract whereby any person is granted or is to enjoy in fact the management of the insurer to the material exclusion of its board of directors or to have the controlling or preemptive right to produce substantially all insurance business for the insurer, or, if an officer, director or otherwise part of the insurer's management, is to receive any commission, bonus or compensation based upon the volume of the insurer's business or transactions, unless the contract is filed with and not disapproved by the superintendent. The contract amendment or renewal shall become effective in accordance with its terms unless disapproved by the superintendent within thirty days after date of filing, subject to such reasonable extension of time as the superintendent may require by written notice given within such thirty days. Any disapproval shall be delivered to the insurer in writing stating the grounds therefor.

B. Any such contract when made, amended, or renewed shall provide that any such manager, producer of its business or contract holder shall within ninety days after expiration of each calendar year furnish the insurer's board of directors a written statement of amounts received under or on account of the contract and amounts expended thereunder during such calendar year, with specification of the emoluments received therefrom by the respective directors, officers, and other principal management personnel of the manager, producer, contract holder or insurer, and with such classification of items and further detail as the insurer's board of directors may reasonably require.

C. The superintendent shall disapprove any such contract, amendment or renewal thereof if he finds that the contract:

(1) subjects the insurer to excessive charges;

(2) is to extend for an unreasonable length of time;

(3) does not contain fair and adequate standards of performance; or

(4) contains other inequitable provisions or provisions which impair the reasonable and proper interests of the insurer's stockholders, policyholders or members.

D. The superintendent may, after a hearing held thereon, disapprove or withdraw his approval of any such contract theretofore permitted to become effective or amended or renewed, if he finds that the contract should be disapproved on any of the grounds specified in Subsection C of this section.

E. Any contract or relationship with and any person who is a managing general agent as defined in the Managing General Agents Law [Chapter 59A, Article 12B NMSA 1978], shall be subject to the provisions of that law.

History: Laws 1984, ch. 127, § 563; 1993, ch. 320, § 66.

The 1993 amendment, effective June 18, 1993, added Subsection E and made minor stylistic changes throughout the section.