THE NONADMITTED INSURANCE AND REINSURANCE REFORM ACT OF 2007 (HR 1065)

July 23, 2007

The bill would establish national standards for how states regulate the surplus lines market and reinsurance.

HR 1065 creates:

  • a uniform system of premium tax allocation and remittance for surplus lines premium taxes;
  • uniform national standards for surplus lines insurer eligibility;
  • one-state compliance on multi-state surplus lines risks;
  • direct access to the surplus lines market for sophisticated commercial purchasers;
  • more efficiency in licensing surplus lines brokers through use of a national data base, and;
  • authority for states to enter into a compact or create procedures to allocate surplus lines premium tax among themselves.

The bill also contains reinsurance provisions which charge the ceding insurer’s home state regulator with making the so-called “credit for reinsurance” determinations. It also would prohibit state insurance regulators from applying their laws to reinsurance agreements of ceding insurers domiciled in other states.