At the August 5, 2020, NAIC Summer National Meeting, the NAIC Surplus Lines Task Force again tabled its new Blanks proposal regarding home state direct premium written.
As we noted previously, the original intent of the proposal was to require U.S. insurers that write surplus lines insurance to report premium on a home state basis, to provide state regulators a basis to reconcile broker reported surplus lines premium with company provided information and ensure that states are receiving the proper amount of surplus lines premium taxes. The reason this information was sought is that premium taxes on surplus lines premiums are based on the total policy premium and paid by surplus lines brokers solely to the “home state” of the insured, as defined in the Nonadmitted and Reinsurance Reform Act of 2010 (NRRA) of the Dodd-Frank Wall Street Reform and Consumer Protection Act . Currently, Schedule T – Exhibit of Premiums Written allocates premium by geographic concentration of risk and not by home state of the insured.
The Task Force had solicited and received many comments from interested parties, which highlighted the burden the proposal would place on insurers and that it would not yield the intended result. The Task Force agreed to again table the proposal.
Locke Lord will continue to monitor any developments.
The post LL Surplus Lines Series (Entry 26): Update: New Blanks Proposal for Home State Direct Premiums Written Again Tabled by NAIC Surplus Lines Task Force appeared first on Insurance & Reinsurance.