Two of the key regulatory issues facing the surplus line industry, multi-state compliance and premium tax allocation in a remittance, could be solved by developing a system of one-state filing for nonadmitted business and adopting an interstate compact, according to a white paper released this week by the Nation Association of Professional Surplus Lines Offices (NAPSLO).
The white paper, available on the NAPSLO web site, was prompted by the growing number of multi-state risks and surplus lines transactions that are being plagued by tax allocation, tax remittance and multi-state compliance problems.
The NAPSLO Board established a special committee of brokers, surplus lines company executive and surplus lines stamping office managers to examine and recommend ways of solving the surplus lines premium tax remittance and multi-state compliance difficulties surplus lines brokers face.
The Committee completed the report entitled: Regulation of the Surplus Lines Industry after Gramm-Leach-Bliley: The Future is Now and submitted it to the NAPSLO Board of Directors, who unanimously adopted the white paper. Following its adoption, the white paper was sent to the NAIC Surplus Lines Task Force.
The Future is Now addresses the opportunities and challenges as well as the problems and issues the surplus lines industry faces in overcoming the difficulties surrounding the current irrational and dysfunctional surplus lines tax remittance procedures and the duplicative and costly multi-state compliance requirements.