S T A T E O F N E W Y O R K ________________________________________________________________________ 4833 2013-2014 Regular Sessions I N A S S E M B L Y February 11, 2013 ___________ Introduced by M. of A. MAGEE, MORELLE -- read once and referred to the Committee on Insurance AN ACT to amend the insurance law, in relation to permitting certain agreements by domestic mutual insurance corporations THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: 1 Section 1. Subsection (f) of section 1209 of the insurance law is 2 amended to read as follows: 3 (f) No domestic mutual insurance corporation, except a domestic mutual 4 insurance company organized before January first, nineteen hundred forty 5 to do only marine protection and indemnity insurance, shall enter into 6 any agreement with any of the officers or directors, or with any firm or 7 corporation in which any such officer or director is pecuniarily inter- 8 ested directly or indirectly, whereby the insurance corporation agrees 9 to pay, for the acquisition of business, any commission or other compen- 10 sation which under the agreement is increased or diminished by the 11 amount of such business or by the insurance corporation's earnings on 12 such business. NOTWITHSTANDING THE FOREGOING, AND UPON APPLICATION BY A 13 DOMESTIC MUTUAL INSURANCE CORPORATION, THE SUPERINTENDENT MAY PERMIT THE 14 INSURANCE CORPORATION TO ENTER INTO SUCH AN AGREEMENT WITH A FIRM OR 15 CORPORATION THAT IS A LICENSED INSURANCE PRODUCER IF THE SUPERINTENDENT 16 DETERMINES THAT: (1) THE INSURANCE CORPORATION'S POLICYHOLDERS WILL NOT 17 BE ADVERSELY AFFECTED; (2) THE OFFICER OR DIRECTOR HAS NO PECUNIARY 18 INTEREST DIRECTLY IN THE INSURANCE PRODUCER; AND (3) ANY BENEFIT TO THE 19 OFFICER OR DIRECTOR THAT ACCRUES AS A RESULT OF THE AGREEMENT WOULD NOT 20 BE MATERIAL IN RELATION TO THE INSURANCE CORPORATION'S OVERALL PREMIUM 21 VOLUME. 22 S 2. This act shall take effect immediately. EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD08131-01-3