Louisiana is now participating in an agreement designed to help states efficiently comply with the requirements of the federal surplus lines regulations that become effective later this month. Insurance Commissioner James Donelon signed the agreement on behalf of Louisiana to join the Non-Admitted Insurance Multi-State Agreement (NIMA) coalition.
NIMA states now represent 19.5 percent of the surplus lines market according to 2009 data, the group’s announcement said. NIMA is an agreement that provides a mechanism to report, collect, allocate and distribute surplus lines tax revenues consistent with the Non-Admitted and Reinsurance Reform Act (NRRA).
The NRRA became part of the Dodd-Frank Wall Street Reform legislation passed in 2010 that allows only the home state to require premium tax payments for non-admitted insurance. Without this agreement, several states could potentially lose surplus lines tax revenues, and distortions in the marketplace could occur.
Florida, Hawaii and Mississippi were the founding members of NIMA. Several states have passed legislation and expressed interest in joining NIMA, but are prohibited from officially joining until the July 21, 2011, deadline established in the federal legislation.
NIMA member states plan to wait until after the July 21 deadline to elect officers and select a clearinghouse to administer the funds.
Topics Legislation Excess Surplus Louisiana
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