National Association of Insurance Commissioners Surplus Lines Implementation Task Force May Adopt Nonadmitted Insurance Multi-State Agreement at December 1 Meeting

The National Association of Insurance Commissioners (“NAIC”) Surplus Lines Implementation Task Force has scheduled a conference call for 4:30 p.m. (EST) on Wednesday, December 1, 2010 to discuss the most recent revision of the Nonadmitted Insurance Multi-State Agreement (“NIMA”).

The updated NIMA draft, a copy of which is attached for review, may be considered for adoption during the December 1 meeting.

Meanwhile, attending legislators at the recent National Conference of Insurance Legislators (“NCOIL”) 2010 Annual Meeting adopted a “slimmed-down” version of the Surplus Lines Insurance Multi-State Compliance Compact, which would authorize a governing commission to establish surplus lines tax allocation formulas, uniform payment methods and reporting requirements, foreign insurer eligibility requirements, and a single policyholder notice, among other provisions.   Dubbed “SLIMPACT-Lite,” the proposal would streamline taxation by requiring a state to create a single tax rate for surplus lines insurance, allow states to charge their own rates on multi-state risks and set uniform payment dates.

Both the NAIC and NCOIL proposals are designed to address state-based surplus lines reform mandated by the Non-admitted and Reinsurance Reform Act in Title V of H.R. 4173, also known as the Dodd-Frank Act of 2010 (“Dodd-Frank”).

While the actions of the NCOIL and the NAIC are not binding, each of the individual states ultimately will need to review and separately adopt a position to address the surplus lines provisions of Dodd-Frank.

NAIC transitioning to new conference call provider as of December 1, 2010

Please note that, effective December 1, 2010, the NAIC will transition to InComm, a new conference call provider. 

Thus, dial-in numbers will change from those used in the past.   After November 30, interested parties are asked to register with InComm by calling (877) 804-2063.  This is a one-time registration process through which InComm will assign an IP code.   This code is required for participation on NAIC conference calls.  

The NAIC has advised that InComm requires two hours to process this one-time registration and assign an IP code, and that interested parties should plan accordingly. 

Complete information on the NAIC’s conference call schedule is posted at http://www.naic.org/meetings_calendar.htm.

Should you have any questions or comments, please contact Colodny Fass.