Friday, December 30, 2011

Nevada Issues Updated Statement Regarding Change in Effective Date of NIMA

In a statement from the Nevada Division of Insurance on December 22, 2011, the Division provided updated guidance to surplus lines insurance producers concerning the Nonadmitted Multi-State Agreement (NIMA) and the requirements for reporting, payment, collection and allocation of taxes and fees for multi-state policies for the first and second quarters of 2012.

The additional guidance was necessary because it is apparent NIMA clearinghouse will not be operational before July 1, 2012. In an emergency meeting on December 20, 2011, NIMA Participating States amended Paragraph 24 of the NIMA Agreement to change the effective date of the premium tax allocation schedule from January 1, 2012 to July 1, 2012, which defers the applicability of multi-state premium tax allocations and the NIMA allocation schedule until July 1, 2012.

Therefore, in Nevada, for the first and second quarters of 2012, the tax allocation provisions of NIMA will not apply, and the taxes and fees due under a multi-state policy would be remitted entirely to the home state of the insured, pursuant to that state’s statutory and regulatory requirements.

Nevada’s Statement dated December 22, 2011 can be found on the Nevada Surplus Lines Association website.

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