X
    X
    X
    X

    LL Surplus Lines Series (Entry 27): Developments in the Surplus Lines Diligent Search Requirement

    Publications

    Multiple developments occurred in the last few weeks throughout the United States relaxing diligent search standards in the surplus lines marketplace.

    On September 21, 2020, The U.S. Virgin Islands (“USVI”) promulgated Order No. 11/2020 (the “USVI Order”) which, among other things, addressed the applicability of the diligent search requirement to various lines of insurance coverage.  Formerly, USVI law required that a diligent effort be conducted by the surplus lines broker “from among a majority of the insurers authorized to transact” the kind of insurance to be offered through a surplus lines insurer.  The USVI Order now only requires declinations from two authorized insurers with respect to homeowner’s insurance, one diligent search requirement for small commercial property and casualty insurance (annual premiums under $35,000) and no diligent search requirement for lager commercial property and casualty insurance risks (annual premiums in excess of $35,000).

    On September 24, 2020, the National Council of Insurance Legislators (“NCOIL”) adopted the Private Primary Residential Flood Insurance Act (the “NCOIL Flood Act”).  The NCOIL Flood Act had been in the works for over a year and sets forth, among other things, that a state’s diligent effort law shall not apply to flood insurance until the applicable state commissioner certifies that there is an adequate market among authorized, admitted insurers for private flood insurance.  South Carolina has already passed Senate Bill 882 waiving the diligent search requirement as to flood insurance, and it remains to be seen what other states will adopt the NCOIL Flood Act and how quick they are to adopt the surplus lines diligent effort provisions.

    The post LL Surplus Lines Series (Entry 27): Developments in the Surplus Lines Diligent Search Requirement appeared first on Insurance & Reinsurance.

    Explore Additional Topics

    Disclaimer

    Please understand that your communications with Locke Lord LLP through this website do not constitute or create an attorney-client relationship with Locke Lord LLP. Any information you send to Locke Lord LLP through this website is on a non-confidential and non-privileged basis. Therefore, do not send or include any information in your email that you consider to be confidential or privileged.