The California Surplus Lines Association recently issued a bulletin noting that the Nonadmitted & Reinsurance Reform Act (NRRA) will exempt surplus line brokers from any state diligent search requirements when procuring surplus line insurance for exempt commercial purchasers but noted that until July 21, 2011, brokers are advised to continue to comply with the current California diligent search requirements.
"The exemption from the diligent search requirement does not take effect until July 21, 2011, the effective date of the NRRA, which means current California law and regulations (and those of other applicable states) regarding diligent search requirements govern. Therefore, until July 21, 2011, brokers are advised to continue to comply with the current California diligent search requirements and those of other applicable states when placing surplus lines insurance for all insureds, including those who currently meet the definition of exempt commercial purchaser."
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