Topic: Excess and Surplus Lines

LL Surplus Lines Series (Entry 17): Idaho Proposes Updating Surplus Lines Laws to Alleviate Diligent Search Requirement

Idaho has seen an impressive surge of surplus lines business over the last year, reporting a 15.7% increase from mid-year 2018 to mid-year 2019, and is now proposing new laws to further drive the growth of its surplus lines market.[1] Pursuant to the Governor’s Executive Order 19-02, (the “Red Tape Reduction Act”), Idaho is rolling out revised regulations for public hearing on October 16, 2019, that provide updated procedures for the placement of surplus lines insurance in the state of Idaho.

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LL Surplus Lines Series (Entry 16): Expert Analysis – Disability Insurance in the Surplus Lines Market and Recent Legislative Updates

The Surplus lines market has traditionally been a method for insurance placement available to property and casualty products only, although states are increasingly opening up other lines of insurance to the nonadmitted market. For example, a growing number of states have either expressly or indirectly allowed for accident and health coverage to be written through the surplus lines market, and the National Association of Insurance Commissioners released guidance earlier this year advising the states on how to effectively legislate for the expansion of insurance lines that may be written on a surplus lines basis.

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LL Surplus Lines Series (Entry 15): Mid-Year 2019 Report Shows Impressive Surplus Lines Growth

As reported in the Insurance Journal, the surplus lines industry is expanding at an approximately 13% faster rate than it was during this time in 2018.  Stamping offices are indicating that premium has already hit $18 billion, a 12.7% growth over mid-year 2018 reports.  All surplus lines service office states except for Nevada have reported a growth in premiums generated by the surplus lines market.  Some of the major coverages that are being increasingly written in the surplus lines space and are contributing to this growth are construction, professional and general liability coverages.

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LL Surplus Lines Series (Entry 14): NAIC Surplus Lines Task Force Considers Blanks Proposal for Home State Direct Premiums Written

At the National Association of Insurance Commissioners Summer National Meeting in New York, the Surplus Lines Task Force discussed a new Blanks proposal regarding home state direct premium written.  The Task Force notes that the intent of the new Blank is to provide “a basis for state regulators to reconcile broker reported surplus lines premium with company provided information to better ensure that states are receiving the proper amount of surplus lines premium taxes.  Premium taxes on surplus lines premiums are based on the total policy premium and paid by surplus lines brokers solely to the “Home State” of the insured as defined in Section 527 of the Non-Admitted and Reinsurance Reform Act of 2010 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.” 

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Locke Lord QuickStudy: Excess Lines Association of New York Publishes Guidance on New York Group P&C Policies

On June 17th, the Excess Lines Association of New York (“ELANY”) published Bulletin No. 2019-19 (the “Bulletin”) detailing New York’s substantial restrictions on group property and casualty insurance policies. The Bulletin echoes some of the remarks at the most recent Surplus Lines Law Group Meeting where this author provided details on the growing regulatory concerns as to group P&C policies.

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LL Surplus Lines Series (Entry 11): Vermont authorizes Domestic Surplus Lines Insurers; Standardizes Premium Tax rates; Repeals SLIMPACT

On June 10, 2019, Governor Phil Scott of Vermont signed Senate Bill 131 (the “Bill”) into law, permitting domestic surplus line insurers to offer and sell surplus lines insurance under a surplus lines certificate of authority in the state.  Imitation is the sincerest form of flattery, and as mentioned in our previous post found here, Nevada passed similar legislation earlier this month.

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LL Surplus Lines Series (Entry 10): Nevada Joins List of Domestic Surplus Lines Insurer States; Revises Broker Fee Statute; Other Changes

Add Nevada to the growing list of states that have adopted domestic surplus lines legislation. Senate Bill 86 (the “Bill”) was signed into law on June 1, 2019, with most provisions effective October 1, 2019. Of perhaps most significance Is that Nevada will now allow for insurance companies to domesticate in Nevada for the exclusive purpose of writing surplus lines insurance coverage within the state and potentially elsewhere.

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LL Surplus Lines Series (Entry 9): Florida and California Make News on Broker and Agent Fees

Earlier this month, Florida passed House Bill 301 to remove the cap on the amount of fees that may be charged by a surplus lines broker in connection with the procurement of surplus lines insurance for a prospective insured. Instead of the old cap of a maximum of $35 per policy, surplus lines brokers will be able to charge any fee that is “reasonable” and disclosed to the insured in advance.

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