Friday, July 08, 2011

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.

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