NAIC Applauds Three States for Streamlining Surplus Lines Activity

Officers of the National Association of Insurance Commissioners (NAIC) applaud three states for leading efforts to implement a multi-state agreement developed by regulators to address the surplus lines part of the Nonadmitted and Reinsurance Reform Act (NRRA). Florida, Hawaii and Mississippi are the first states to enter the Nonadmitted Insurance Multi-State Agreement (NIMA), with additional states anticipated to join shortly. The agreement is authorized by the federal Dodd-Frank Wall Street reform legislation that was passed last year and allows state authorities to work cooperatively to collect and allocate premium taxes for multi-state surplus lines insurance transactions. Surplus lines insurance companies cover risks that are not insurable in the admitted or licensed insurance market.

"I commend Commissioners Kevin M. McCarty, Gordon Ito and Mike Chaney for leading their states in this nationwide effort," said Susan E. Voss, NAIC President and Iowa Insurance Commissioner. "The process of developing NIMA was guided by regulators' commitment to preserve the ability of states to receive surplus lines premium taxes and to ensure they continue to receive taxes based on the risk or exposure located in their state."

“The bottom line on surplus lines is that states rely, in part, on these premium taxes to support their general funds,” said Jim Donelon, NAIC Vice President, Louisiana Insurance Commissioner and Chair of the Surplus Lines Implementation Task Force. “Florida, Hawaii and Mississippi are leading the way on a state-based, national solution that addresses the challenge of the NRRA.”
 
About the NAIC
Formed in 1871, the National Association of Insurance Commissioners (NAIC) is a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and five U.S. territories. The NAIC has three offices: Executive Office, Washington, D.C.; Central Office, Kansas City, Mo.; and Securities Valuation Office, New York City. The NAIC serves the needs of consumers and the industry, with an overriding objective of supporting state insurance regulators as they protect consumers and maintain the financial stability of the insurance marketplace. For more information, visit www.naic.org.