Thursday, July 28, 2011
NAPSLO Testifies Before House Subcommittee
Representatives of NAPSLO and other industry groups testified during a hearing of the Subcommittee on Insurance, Housing and Community Opportunity this morning on “Insurance Oversight: Policy Implications for Consumers, Businesses and Jobs” and a video copy of the testimony has been posted on the House Financial Services Committee website.
Wednesday, July 27, 2011
Congressional Intent of NRRA is Threatened, NAPSLO Testifies to House Subcommittee
The Congressional mandate of making multistate surplus lines transactions and tax payments more uniform, efficient and streamlined for consumers, businesses and brokers is threatened by the Nonadmitted Insurance Multistate Agreement (NIMA), NAPSLO said in testimony submitted to the House Financial Services Subcommittee on Insurance, Housing and Community Opportunity for a hearing on July 28 entitled “Insurance Oversight: Policy Implications for Consumers, Businesses and Jobs.”
“NAPSLO is increasingly concerned that the NRRA is being implemented in many states (even as promoted by NAIC) in such a way that they’ll make things worse – not better – for surplus lines stakeholders,” said NAPSLO’s testimony. “Unfortunately certain state interpretation and implementation of the NRRA has, in NAPSLO’s view, been inconsistent with Congress’s intent."
The House subcommittee hearing is set for 10:00 a.m. (Eastern) on Thursday and NAPSLO President Letha Heaton will be testifying before the subcommittee as part of an industry panel. A live webcast feed is scheduled to be available from the subcommittee website. Complete testimony and press release on testimony are available to download.
NAPSLO strongly opposes NIMA’s current tax allocation methodology as it is wholly unworkable for the vast majority of the industry, and if implemented will result in new costs and fees levied on surplus lines consumers. As part of its testimony, NAPSLO included comments from brokers on the difficulty they would have in operating under the NIMA allocation system.
NAPSLO urges parties to abandon the NIMA tax allocation methodology and instead adopt one based on state by state premium data from the “Schedule T” section of annual financial statement submitted to the NAIC by surplus lines carriers. Kentucky’s insurance commissioner has proposed a tax allocation formula to allocate taxes based on exposures. While NAPSLO favors a “Schedule T” approach, it also believes the approach proposed by Kentucky presents a workable compromise that would be a vast improvement over the NAIC-NIMA tax methodology.
“NAPSLO is increasingly concerned that the NRRA is being implemented in many states (even as promoted by NAIC) in such a way that they’ll make things worse – not better – for surplus lines stakeholders,” said NAPSLO’s testimony. “Unfortunately certain state interpretation and implementation of the NRRA has, in NAPSLO’s view, been inconsistent with Congress’s intent."
The House subcommittee hearing is set for 10:00 a.m. (Eastern) on Thursday and NAPSLO President Letha Heaton will be testifying before the subcommittee as part of an industry panel. A live webcast feed is scheduled to be available from the subcommittee website. Complete testimony and press release on testimony are available to download.
NAPSLO strongly opposes NIMA’s current tax allocation methodology as it is wholly unworkable for the vast majority of the industry, and if implemented will result in new costs and fees levied on surplus lines consumers. As part of its testimony, NAPSLO included comments from brokers on the difficulty they would have in operating under the NIMA allocation system.
NAPSLO urges parties to abandon the NIMA tax allocation methodology and instead adopt one based on state by state premium data from the “Schedule T” section of annual financial statement submitted to the NAIC by surplus lines carriers. Kentucky’s insurance commissioner has proposed a tax allocation formula to allocate taxes based on exposures. While NAPSLO favors a “Schedule T” approach, it also believes the approach proposed by Kentucky presents a workable compromise that would be a vast improvement over the NAIC-NIMA tax methodology.
Saturday, July 23, 2011
Nevada hopes to profit from insurance pact - NevadaAppeal.com
The Nevada Board of Examiners this week approved joining the Nonadmitted Insurance Multi-State Agreement (NIMA), however the Insurance Department said it would monitor the process and if the state loses money rather than gain, they'll advise the board immediately as the state can pull out of the pact on 60 days notice, according to an article in the Nevada Appeal.
Nevada hopes to profit from insurance pact | NevadaAppeal.com
Nevada hopes to profit from insurance pact | NevadaAppeal.com
Thursday, July 21, 2011
Surplus Lines Industry Enters New Era on Multistate Risks Taxes with NRRA Now Effective
Surplus lines brokers entered a new era on handling multistate risks on Thursday when the Nonadmitted and Reinsurance Reform Act (NRRA) became effective, and representatives of NAPSLO said the change reflects a long campaign to simplify the tax payment process on multistate risks.
"With the NRRA becoming effective on July 21 surplus lines brokers will see a system where there is one state compliance, one state taxation, national standards for company eligibility and national exempt commercial purchaser rules," said NAPSLO Executive Director Richard Bouhan. "These are issues the industry has been working on for a number of years and are pleased to see this law take effect."
While July 21st is an important day for the industry, because of the need to quote policies in advance a number of brokers have already been working under the new law. To assist brokers with the changes, NAPSLO has been providing information on the new law on its website.
“Brokers have been working for quite some time on policies that will be effective on July 21 or after, and so have already been operating under the new NRRA rules," said Mr. Bouhan. "In addition, it has been estimated that up to 95% of all surplus lines risks are single state risks so the NRRA may only impact a limited number of risks"
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over multistate surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance and California and Texas are the most recent states to enact NRRA compliance legislation.
"NAPSLO applauds California and Texas for enacting their bill as it conforms the states' codes to the NRRA," said NAPSLO Legislative Co-Chair Hank Haldeman. "It was important for the largest surplus lines states to bring its laws into compliance prior to the NRRA's effective date."
Overall 43 states passed legislation to bring their state laws into compliance with the NRRA; three states (Iowa, Illinois and Colorado) adjourned without taking action; and four states (Michigan, Wisconsin Massachusetts, and South Carolina) and the District of Columbia have not passed any legislation. Of the 43 states, three states (Delaware, Oregon, and New Jersey) have approved legislation but the governors have not taken action on the bills.
In addition, six states have signed an agreement to be part of the Nonadmitted Insurance Multistate Agreement (NIMA) and nine states passed Surplus Lines Insurance Multi-State Compliance Compact (SLIMPACT) legislation.
"While a number of states have indicated a willingness to take part in a tax sharing compact, no compact is in operation," said Legislative Co-Chair Dave Leonard. “As of July 21st taxes on all surplus lines policies will be paid to the home state of insured and the home state becomes the sole regulator of the transaction."
"With the NRRA becoming effective on July 21 surplus lines brokers will see a system where there is one state compliance, one state taxation, national standards for company eligibility and national exempt commercial purchaser rules," said NAPSLO Executive Director Richard Bouhan. "These are issues the industry has been working on for a number of years and are pleased to see this law take effect."
While July 21st is an important day for the industry, because of the need to quote policies in advance a number of brokers have already been working under the new law. To assist brokers with the changes, NAPSLO has been providing information on the new law on its website.
“Brokers have been working for quite some time on policies that will be effective on July 21 or after, and so have already been operating under the new NRRA rules," said Mr. Bouhan. "In addition, it has been estimated that up to 95% of all surplus lines risks are single state risks so the NRRA may only impact a limited number of risks"
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over multistate surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance and California and Texas are the most recent states to enact NRRA compliance legislation.
"NAPSLO applauds California and Texas for enacting their bill as it conforms the states' codes to the NRRA," said NAPSLO Legislative Co-Chair Hank Haldeman. "It was important for the largest surplus lines states to bring its laws into compliance prior to the NRRA's effective date."
Overall 43 states passed legislation to bring their state laws into compliance with the NRRA; three states (Iowa, Illinois and Colorado) adjourned without taking action; and four states (Michigan, Wisconsin Massachusetts, and South Carolina) and the District of Columbia have not passed any legislation. Of the 43 states, three states (Delaware, Oregon, and New Jersey) have approved legislation but the governors have not taken action on the bills.
In addition, six states have signed an agreement to be part of the Nonadmitted Insurance Multistate Agreement (NIMA) and nine states passed Surplus Lines Insurance Multi-State Compliance Compact (SLIMPACT) legislation.
"While a number of states have indicated a willingness to take part in a tax sharing compact, no compact is in operation," said Legislative Co-Chair Dave Leonard. “As of July 21st taxes on all surplus lines policies will be paid to the home state of insured and the home state becomes the sole regulator of the transaction."
Wednesday, July 20, 2011
Texas Passes NRRA Legislation Focusing on Compliance, Tax Payment
The Texas Governor has signed into law Nonadmitted and Reinsurance Reform Act (NRRA) compliance legislation. Texas is among the latest state to enact NRRA related implementation legislation. During the session NAPSLO provided draft legislation, offered comments and spoke with representatives of the department of insurance.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
SB1, in part, amends the surplus lines premium tax and independently procured tax statutes (Sections 225 and 226, Texas Insurance Code) to conform with the provisions of the NRRA. The bill adds definitions for “affiliate,” “affiliated group,” “control,” “home state,” and “independently procured insurance.” It also provides that Texas may not impose a tax on nonadmitted insurance other than premiums paid for insurance in which Texas is the home state of the insured.
SB1 further enables Texas to tax 100% of multi-state risks, where it is the home state, in the event Texas does not join a tax compact. If Texas does join a tax compact, SB1 authorizes the state to allocate taxes in accordance with the terms of the agreement. SB1 refers to existing statutes for the authorization to enter a tax compact.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
SB1, in part, amends the surplus lines premium tax and independently procured tax statutes (Sections 225 and 226, Texas Insurance Code) to conform with the provisions of the NRRA. The bill adds definitions for “affiliate,” “affiliated group,” “control,” “home state,” and “independently procured insurance.” It also provides that Texas may not impose a tax on nonadmitted insurance other than premiums paid for insurance in which Texas is the home state of the insured.
SB1 further enables Texas to tax 100% of multi-state risks, where it is the home state, in the event Texas does not join a tax compact. If Texas does join a tax compact, SB1 authorizes the state to allocate taxes in accordance with the terms of the agreement. SB1 refers to existing statutes for the authorization to enter a tax compact.
Monday, July 18, 2011
California Enacts NRRA Legislation; Law Doesn't Address Compact, Sharing Premium Taxes
California has enacted Nonadmitted and Reinsurance Reform Act (NRRA) compliance legislation that authorizes the imposition of surplus lines premium tax and independent procurement tax on 100% of premium, however the bill does not addresses compacts or sharing premium taxes with other states.
California is among the latest states to enact NRRA related implementation legislation. During the session NAPSLO provided draft legislation, offered comments and met with legislators and representatives of the department of insurance.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
California's bill, A315, authorizes the imposition of surplus lines premium tax and independent procurement tax on 100% of the premium, however, as amended, the bill does not addresses sharing premium taxes with other states.
The bill proposes what is essentially an "A" list/"B" list approach to eligible surplus lines insurers. The "B" list appears to follow the NRRA mandated standards, however requires B list insurers to file a number of documents with the Department (e.g., certificate of capital and surplus issued by the insurer's domiciliary jurisdiction, certified copy of the insurer's license, etc.). Obtaining "A" listed status would entail all of the burdens of current eligibility in California.
The bill does include the NRRA definition of exempt commercial purchaser (ECP) concept and allows free export of ECP business subject to the conditions set forth in the NRRA. The bill further requires brokers to undertake additional record keeping requirements related to NRRA. Brokers will now need to record the insured's home state, if an ECP, verify that the insured qualifies as an ECP, determine whether the risk is single state or multistate and if multistate, allocate premium taxes even though there are no provisions for sharing of taxes with other states.
The amended version notes that "if a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, and is placed on or before July 20, 2011, then the policy shall be considered to be business done by the surplus line broker as of the effective date. If a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, then the policy shall be considered to be business done by the home state insured who directly procures policies as of the effective date."
California is among the latest states to enact NRRA related implementation legislation. During the session NAPSLO provided draft legislation, offered comments and met with legislators and representatives of the department of insurance.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
California's bill, A315, authorizes the imposition of surplus lines premium tax and independent procurement tax on 100% of the premium, however, as amended, the bill does not addresses sharing premium taxes with other states.
The bill proposes what is essentially an "A" list/"B" list approach to eligible surplus lines insurers. The "B" list appears to follow the NRRA mandated standards, however requires B list insurers to file a number of documents with the Department (e.g., certificate of capital and surplus issued by the insurer's domiciliary jurisdiction, certified copy of the insurer's license, etc.). Obtaining "A" listed status would entail all of the burdens of current eligibility in California.
The bill does include the NRRA definition of exempt commercial purchaser (ECP) concept and allows free export of ECP business subject to the conditions set forth in the NRRA. The bill further requires brokers to undertake additional record keeping requirements related to NRRA. Brokers will now need to record the insured's home state, if an ECP, verify that the insured qualifies as an ECP, determine whether the risk is single state or multistate and if multistate, allocate premium taxes even though there are no provisions for sharing of taxes with other states.
The amended version notes that "if a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, and is placed on or before July 20, 2011, then the policy shall be considered to be business done by the surplus line broker as of the effective date. If a new or renewal policy has an effective date between January 1, 2011, to July 20, 2011, inclusive, then the policy shall be considered to be business done by the home state insured who directly procures policies as of the effective date."
Thursday, July 14, 2011
Louisiana Joins Florida, Hawaii, & Mississippi in NIMA Coalition
Louisiana is now participating in an agreement designed to help states efficiently comply with the requirements of the federal surplus lines regulations that become effective later this month. Insurance Commissioner James Donelon signed the agreement on behalf of Louisiana to join the Non-Admitted Insurance Multi-State Agreement (NIMA) coalition, according to the Insurance Journal.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
In June the Florida Office of Insurance Regulation (Office) that Florida has entered into an agreement with Mississippi and Hawaii to start NIMA.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
In June the Florida Office of Insurance Regulation (Office) that Florida has entered into an agreement with Mississippi and Hawaii to start NIMA.
Tuesday, July 12, 2011
Wisconsin Commissioner Issues Bulletin on Federal Case on Forms Filing
The Wisconsin Office of the Commissioner of Insurance (OCI) has issued a bulletin to insurers regarding Surplus Lines Forms Filings following a recent decision in federal court.
The bulletin noted that in the Gillen case, the Federal District Court in the Eastern District of Wisconsin held that s. 631.20 (form filing) and s. 631.85 (arbitration clause approval required) applied to a surplus lines policy. The surplus lines insurer tried to compel arbitration of an indemnity liability claim of its insured. The court ruled the arbitration clause was unenforceable because the form had not been filed with and the arbitration clause approved by OCI under the cited statutes.
The bulletin added that as a result of the Gillen case, the OCI has received inquiries from surplus lines companies regarding the requirement of and procedure for filing with the OCI forms that are written under s. 618.41, Wis. Stat. OCI has not historically required surplus lines insurers to file forms in Wisconsin and, notwithstanding the Gillen decision [747 F. Supp. 2d 1058], the Office continues its position that surplus lines forms need not be filed, including those with arbitration clauses. All surplus lines insurers placing business in Wisconsin are informed that the OCI does not consider policy forms issued under s. 618.41, Wis. Stat., on business that is resident or located in Wisconsin to be subject to ss. 631.20 and 631.85, Wis. Stat. Therefore, companies writing in Wisconsin on a surplus lines basis are not required by OCI to file their forms with the Office.
The bulletin noted that in the Gillen case, the Federal District Court in the Eastern District of Wisconsin held that s. 631.20 (form filing) and s. 631.85 (arbitration clause approval required) applied to a surplus lines policy. The surplus lines insurer tried to compel arbitration of an indemnity liability claim of its insured. The court ruled the arbitration clause was unenforceable because the form had not been filed with and the arbitration clause approved by OCI under the cited statutes.
The bulletin added that as a result of the Gillen case, the OCI has received inquiries from surplus lines companies regarding the requirement of and procedure for filing with the OCI forms that are written under s. 618.41, Wis. Stat. OCI has not historically required surplus lines insurers to file forms in Wisconsin and, notwithstanding the Gillen decision [747 F. Supp. 2d 1058], the Office continues its position that surplus lines forms need not be filed, including those with arbitration clauses. All surplus lines insurers placing business in Wisconsin are informed that the OCI does not consider policy forms issued under s. 618.41, Wis. Stat., on business that is resident or located in Wisconsin to be subject to ss. 631.20 and 631.85, Wis. Stat. Therefore, companies writing in Wisconsin on a surplus lines basis are not required by OCI to file their forms with the Office.
Monday, July 11, 2011
Funeral Arrangements for Kevin Cole
Funeral arrangements for Kevin Cole, a longtime member of the NAPSLO Legislative Committee who passed away last week, have been announced
A Wake Services will be held on Thursday July 14, 2011 from 6:00-9:00 p.m. and on Friday from 10:00 a.m. until 12:30 p.m. at E. J. Fielding Funeral Home, 2260 West 21st. Ave., Covington, Louisiana.
A Funeral Mass will be on Friday July 15, 2011 at 1:00 p.m. at St. Joseph Abbey, 75376 River Road, St. Benedict, LA. (St. Joseph Abbey is just north of Covington) Interment will follow the Mass at St. Joseph Abbey Cemetery.
The full obituary is available to view and there is also a guest book on the site for your convenience.
A Wake Services will be held on Thursday July 14, 2011 from 6:00-9:00 p.m. and on Friday from 10:00 a.m. until 12:30 p.m. at E. J. Fielding Funeral Home, 2260 West 21st. Ave., Covington, Louisiana.
A Funeral Mass will be on Friday July 15, 2011 at 1:00 p.m. at St. Joseph Abbey, 75376 River Road, St. Benedict, LA. (St. Joseph Abbey is just north of Covington) Interment will follow the Mass at St. Joseph Abbey Cemetery.
The full obituary is available to view and there is also a guest book on the site for your convenience.
Friday, July 08, 2011
NAPSLO Notes Passing of Kevin Cole, Longtime Member of NAPSLO's Legislative Committee
Kevin Cole, a director of the law firm of Galloway, Johnson, Tompkins, Burr & Smith and a longtime member of NAPSLO’s Legislative Committee, passed away on Thursday following a car accident.
Funeral arrangements for Mr. Cole, who worked in the firm’s Mandeville, La. office, are pending and more information will be announced by his law firm and the E.J. Fielding Funeral Home.
Funeral arrangements for Mr. Cole, who worked in the firm’s Mandeville, La. office, are pending and more information will be announced by his law firm and the E.J. Fielding Funeral Home.
Missouri Approves NRRA Compliance Legislation; Bill Does Not Address Compact
Missouri has enacted the Nonadmitted and Reinsurance Reform Act (NRRA) compliance legislation, however the legislation does not address the state joining a compact or tax sharing agreement.
Missouri is among the latest states to pass NRRA implementation legislation and during the session NAPSLO provided draft legislation, offered comments on legislation and testified during a hearing.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are working to bring their laws into compliance.
Missouri’s bill does not address premium tax sharing, but would require the payment of premium tax based on 100% of the gross premium. The bill provides for exclusive home state regulation of nonadmitted insurance and defines home state per the NRRA as well as principal place of business. It incorporates the NRRA's Exempt Commercial Purchaser (ECP) exemption and generally incorporates the NRRA insurer eligibility requirements.
Missouri is among the latest states to pass NRRA implementation legislation and during the session NAPSLO provided draft legislation, offered comments on legislation and testified during a hearing.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are working to bring their laws into compliance.
Missouri’s bill does not address premium tax sharing, but would require the payment of premium tax based on 100% of the gross premium. The bill provides for exclusive home state regulation of nonadmitted insurance and defines home state per the NRRA as well as principal place of business. It incorporates the NRRA's Exempt Commercial Purchaser (ECP) exemption and generally incorporates the NRRA insurer eligibility requirements.
NCOIL Issues Letter Urging Support of Simple & Efficient Surplus Lines Tax Allocation Formulas
Representatives of the National Council of Insurance Legislators are urging fellow legislators to not allow Surplus Lines Insurance Multi-State Compliance Compact (SLIMPACT) to be molded into NIMA and are encouraging states to pursue allocation formulas that appropriately respond to the concerns that spurred the NRRA.
In a letter from legislators from states that supported SLIMPACT to SLIMPACT Commission Representatives, the sponsors wrote to “strongly urge you to pursue surplus lines tax allocation formulas that will be simple and efficient,” the letter said. “We have grave concerns with formulas — such as those called for under a Nonadmitted Insurance Multi-State Agreement (NIMA)—that would complicate existing practices and that would cause undue burdens for those that have advocated modernization, including insurance industry representatives, brokers, or insureds.”
The state legislators said they do not support SLIMPACT being molded into NIMA and endorsed SLIMPACT as a means to streamline surplus lines taxation and regulation. They added they did not support allocation formulas not “based upon readily available data with simplicity and uniformity for the Surplus Line Licensee as a material consideration.”
The lawmakers express concern that the U.S. Congress could again intervene in surplus lines regulation if the states do not provide the uniformity sought under Dodd-Frank. "The new Federal Insurance Office (FIO) also is likely monitoring state activity and could recommended follow-up federal legislation if we are not successful," the letter said.
“As state officials, like you, we believe that the states must continue to regulate insurance. We are concerned that our inability to streamline an issue as relatively simple as paying tax on a multi-state risk could embolden the efforts of those who argue against state regulation and who would like to see us fail."
In a letter from legislators from states that supported SLIMPACT to SLIMPACT Commission Representatives, the sponsors wrote to “strongly urge you to pursue surplus lines tax allocation formulas that will be simple and efficient,” the letter said. “We have grave concerns with formulas — such as those called for under a Nonadmitted Insurance Multi-State Agreement (NIMA)—that would complicate existing practices and that would cause undue burdens for those that have advocated modernization, including insurance industry representatives, brokers, or insureds.”
The state legislators said they do not support SLIMPACT being molded into NIMA and endorsed SLIMPACT as a means to streamline surplus lines taxation and regulation. They added they did not support allocation formulas not “based upon readily available data with simplicity and uniformity for the Surplus Line Licensee as a material consideration.”
The lawmakers express concern that the U.S. Congress could again intervene in surplus lines regulation if the states do not provide the uniformity sought under Dodd-Frank. "The new Federal Insurance Office (FIO) also is likely monitoring state activity and could recommended follow-up federal legislation if we are not successful," the letter said.
“As state officials, like you, we believe that the states must continue to regulate insurance. We are concerned that our inability to streamline an issue as relatively simple as paying tax on a multi-state risk could embolden the efforts of those who argue against state regulation and who would like to see us fail."
Tuesday, July 05, 2011
Surplus Lines Law Group Fall Meeting Set for Sept. 22-23 in Charleston; Registration Now Open
The fall meeting of the Surplus Lines Law Group is set for September 22-23, 2011 at the Renaissance Charleston Hotel in Charleston, South Carolina and registration is now open.
The meeting will open with a dinner on Thursday, September 22, followed by meeting on the morning of Friday, September 23. To attend, please click on the following link to register and then make your hotel reservation using the information below.
You may reserve a room online for the night of September 22 at the group rate through the hotel's website. Attendees arriving prior to September 22 or departing after September 23 must call the hotel to make a reservation.
If you have any questions regarding the meeting or registration, please contact Steve Stephan at NAPSLO at 816-741-3910.
The meeting will open with a dinner on Thursday, September 22, followed by meeting on the morning of Friday, September 23. To attend, please click on the following link to register and then make your hotel reservation using the information below.
Hotel Accommodations
Attendees are responsible for their own individual hotel reservations for the meeting. Group rates are $179 per night if reserved by September 8, 2011. To reserve a hotel room by phone, call (800) 468-3571 or (843) 534-0300 and reference the NAPSLO Surplus Lines Law Group meeting.You may reserve a room online for the night of September 22 at the group rate through the hotel's website. Attendees arriving prior to September 22 or departing after September 23 must call the hotel to make a reservation.
If you have any questions regarding the meeting or registration, please contact Steve Stephan at NAPSLO at 816-741-3910.
Friday, July 01, 2011
Pennsylvania Enacts NRRA Legislation; No Mention of Compact, Tax Sharing Agreement
The Pennsylvania Governor has signed into law Nonadmitted and Reinsurance Reform Act (NRRA) compliance related legislation that does not address a compact or tax sharing agreement.
Pennsylvania is the latest state to enact NRRA related implementation legislation. During the session NAPSLO provided draft legislation, offered comments and spoke with representatives of the department of insurance.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
Pennsylvania's SB 1096 requires the payment of surplus lines tax and independently procured insurance tax based on 100% of the entire premium when Pennsylvania is the home state, without allocation to other states. The bill would maintain annual reporting and payment of surplus lines taxes for surplus lines brokers. It provides for exclusive home state regulation and taxation per the NRRA. The provisions regarding premium tax would be effective for "policies placed after June 30, 2011."
The bill defines home state per the NRRA, incorporates the NRRA's exempt commercial purchaser (ECP) exemption and also incorporates the NRRA's insurer eligibility requirements.
Pennsylvania is the latest state to enact NRRA related implementation legislation. During the session NAPSLO provided draft legislation, offered comments and spoke with representatives of the department of insurance.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
Pennsylvania's SB 1096 requires the payment of surplus lines tax and independently procured insurance tax based on 100% of the entire premium when Pennsylvania is the home state, without allocation to other states. The bill would maintain annual reporting and payment of surplus lines taxes for surplus lines brokers. It provides for exclusive home state regulation and taxation per the NRRA. The provisions regarding premium tax would be effective for "policies placed after June 30, 2011."
The bill defines home state per the NRRA, incorporates the NRRA's exempt commercial purchaser (ECP) exemption and also incorporates the NRRA's insurer eligibility requirements.
Louisiana Enacts NRRA Legislation Allowing State to Enter NIMA or other Tax Sharing Agreements
The Louisiana Governor has signed into law a bill that authorizes the Commissioner to enter into NIMA or other cooperative compacts or agreements with other states.
Louisiana is among the latest states to enact Nonadmitted and Reinsurance Reform Act (NRRA) related implementation legislation. During the session NAPSLO provided draft legislation and offered comments.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
Louisiana HB469 is primarily a premium tax bill that authorizes the Commissioner to enter into NIMA or other cooperative compacts or agreements with other states and to maintain the state's revenues from surplus lines insurance premium taxes and to comply with the NRRA.
The bill provides that "there shall be a tax on all premiums paid for surplus lines insurance" covering multistate risks and for which Louisiana is the home state of the insured and "surplus lines brokers and independently procuring insureds shall remit the tax to the Commissioner...." The tax rate applied to premiums allocated to Louisiana is 5% and the tax rates and fees applied to premiums allocated to other states participating in a tax sharing system with Louisiana are the tax rates and fees of those other state.
The bill would require brokers and insureds to file quarterly reports on multistate risks when Louisiana is the home state of the insured, on a form prescribed by the Commissioner which would conform to any tax sharing agreement or compact and would retain the current quarterly reporting requirement for single state risks.
The bill incorporates the NRRA's definition of "home state," but does not address any of the NRRA reforms other than regarding payment of nonadmitted insurance premium tax when Louisiana is the home state.
Louisiana is among the latest states to enact Nonadmitted and Reinsurance Reform Act (NRRA) related implementation legislation. During the session NAPSLO provided draft legislation and offered comments.
The NRRA mandates that beginning July 21, 2011 the insured's home state will be the only state with jurisdiction over surplus lines transactions and the only state that can require a tax be paid by the broker. As a result states are bringing their laws into compliance.
Louisiana HB469 is primarily a premium tax bill that authorizes the Commissioner to enter into NIMA or other cooperative compacts or agreements with other states and to maintain the state's revenues from surplus lines insurance premium taxes and to comply with the NRRA.
The bill provides that "there shall be a tax on all premiums paid for surplus lines insurance" covering multistate risks and for which Louisiana is the home state of the insured and "surplus lines brokers and independently procuring insureds shall remit the tax to the Commissioner...." The tax rate applied to premiums allocated to Louisiana is 5% and the tax rates and fees applied to premiums allocated to other states participating in a tax sharing system with Louisiana are the tax rates and fees of those other state.
The bill would require brokers and insureds to file quarterly reports on multistate risks when Louisiana is the home state of the insured, on a form prescribed by the Commissioner which would conform to any tax sharing agreement or compact and would retain the current quarterly reporting requirement for single state risks.
The bill incorporates the NRRA's definition of "home state," but does not address any of the NRRA reforms other than regarding payment of nonadmitted insurance premium tax when Louisiana is the home state.
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