58-6A-3.1. Majority of risk retention group directors to be independent--Board determinations as to material relationship.
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/sd/title-58/chapter-58-6/58-6a-3-1·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
The board of directors of the risk retention group shall have a majority of independent directors. If the risk retention group is a reciprocal, then the attorney-in-fact shall adhere to the same standards regarding independence of operation and governance as imposed on the risk retention group's board of directors or subscriber's advisory committee under these standards. In addition, to the extent permissible under state law, a service provider of a reciprocal risk retention group shall contract with the risk retention group and not the attorney-in-fact.
No director of the risk retention group qualifies as independent unless the board of directors affirmatively determines that the director of the risk retention group has no material relationship as described in § 58-6A-3.2 with the risk retention group. Each risk retention group shall disclose these determinations to the group's domestic regulator, at least annually. For the purposes of this section, any person that is a direct or indirect owner of or subscriber in the risk retention group or is an officer, director of the risk retention group, or employee of such an owner and insured, unless some other position of the officer, director of the risk retention group, or an employee constitutes a material relationship, as contemplated by section 3901(a)(4)(E)(ii) of the Liability Risk Retention Act in effect as of January 1, 2016, is considered to be independent.