614 Surplus lines filing requirements

Surplus Lines Filing Requirements

[27 Pa.B. 1989]

   Effective January 1, 1997, the Pennsylvania Surplus Lines Association (PSLA) commenced operations as a surplus lines advisory organization. By Insurance Department (Department) Notice No. 1996-19 dated December 23, 1996, surplus lines agents were instructed to submit all filings regarding the placement of surplus lines insurance to PSLA. As authorized by statute, PSLA is empowered to:

   Examine declarations for compliance with the Surplus Lines Law or the rules and regulations adopted thereunder; and

   Report to the Department any declaration which does not appear to be in compliance with the Surplus Lines Law or the rules or regulations adopted thereunder.

   PSLA is obligated to report to the Department any incorrect filings, including declarations of diligence search, which are late, incomplete, or submitted on an incorrect form. PSLA has reported to the Department that up to 85% of the surplus lines declaration filings submitted since January 1, 1997 are deficient in some manner.

   By this notice, agents are reminded of their obligation to submit accurate, timely and complete filings regarding the placement of surplus lines policies. Surplus lines agents who repeatedly submit erroneous filings may become subject to enforcement action by the Department. Penalties which may be imposed after a hearing to consider an alleged violation of law include the suspension, revocation or nonrenewal of the offender's license, or imposition of a civil penalty.

   All surplus lines agents are expected to be familiar with Article XVI of the Insurance Company Law (40 P. S. § 991.1601 et seq.) and the procedures manual previously provided by PSLA. In addition, PSLA will provide, upon request, step-by-step instructions for completing forms 1609-PB, 1609-SLL and 1609-B. Surplus lines brokers may wish to forward a copy of the step-by-step instructions for completing form 1609-PB to all producing brokers from whom they accept business.

   Questions concerning the procedures for completing and submitting surplus lines filings should be directed to Kenneth Rudert, Pennsylvania Surplus Lines Association, Exton Professional Building, Suite 313, 319 North Pottstown Pike, Exton, PA 19341, telephone [phone] or [phone] or fax [phone]. Questions regarding this notice may be directed to Cressinda Bybee, Insurance Company Licensing Specialist, Office of Regulation of Companies, 1345 Strawberry Square, Harrisburg, PA 17120, telephone [phone].

LINDA S. KAISER,   
Insurance Commissioner

[Pa.B. Doc. No. 97-614. Filed for public inspection April 18, 1997, 9:00 a.m.]