Stamping Fee to Decrease on Illinois Surplus Line Policies Effective Jan. 1
The stamping fee for surplus line policies written in Illinois with an effective date on or after Jan. 1, 2019, will drop to 0.075 percent (premium X 0.00075), rounded to the nearest whole dollar, the Surplus Line Association of Illinois (SLA) reported in a bulletin. The new rate also applies to any endorsements to such policies.
For policies and endorsements effective prior to Jan. 1, 2019, the current stamping fee of 0.125 percent will apply.
Special rules may apply for multi-year policies, renewal endorsements and policy extensions, and other stamping fee rates applicable to older policies. The stamping fee section of SLA’s website contains an online procedures manual with more information on rules and fee calculation.
The Surplus Line Association of Illinois (SLA) is composed of approximately 2,400 surplus line insurance producers who hold a special license from the Illinois Department of Insurance allowing them, under certain conditions, to procure policies from insurers that are not licensed in this state.
Created by statute in 1985, the SLA acts as a liaison between the insurance department and surplus line producers. All licensed surplus line producers in Illinois are members and are required to submit contracts for excess and surplus (E&S) insurance policies to the SLA for stamping and recording.
The Illinois SLA is one of 15 stamping or service offices in the U.S.; they collectively record more than 60 percent of all surplus lines insurance written nationally.
A report released mid-year 2018 by the Surplus Lines Stamping Office of Texas (SLTX), which tracks surplus lines activity in the 15 U.S. stamping offices, showed that Illinois was among seven states that saw surplus lines filings increase by more than 10 percent during the first half of the year. At mid-year, Illinois had recorded $821 million in surplus lines premium, according to SLT. The Surplus Lines Association of Minnesota, the only other stamping office in the Midwest, recorded $251 million in surplus lines premium as of mid-year.
Overall, E&S premium recorded by U.S. stamping offices increased by 9.4 percent during the first half of 2018 over first-half totals recorded in 2017. As of July 2018, total premium reported was $15.7 billion, about $1.4 billion more than that recorded in the same period in 2017, according to SLTX.