Last Updated:April 24, 2024
What is Surplus Lines?
Surplus lines insurance is insurance placed with unauthorized insurers through surplus lines agents. A surplus lines agent is someone licensed to place insurance under
s. 628.04 (2), Wis. Stat.
An unauthorized insurer is one that does not hold a valid certificate of authority to do insurance business in this state.
Resident Surplus Lines Requirements
- Resident applicants must hold an active property & casualty license.
- Apply via
nipr.com
or through an
NIPR authorized business partner
.
- Pay initial license fee of $100.
Nonresident Surplus Lines Requirements
- Active surplus lines license in resident state.
- Apply via nipr.com or through an NIPR authorized business partner .
- Pay initial license fee of $100.
Renewal Requirements for Resident and Nonresident Surplus Lines
Surplus lines licenses renew annually on the last day of the agent's birth month. Surplus lines renewals are available to renew 90 days prior the license expiration date.
- Renew via
nipr.com or through an NIPR authorized business partner .
- Pay renewal fee of $100.
Please note: Surplus lines licenses are not eligible for reinstatement. If your license becomes inactive, you must re-apply and pay the licensing fee via
nipr.com or through an
NIPR authorized business partner .
Frequently Asked Questions
May surplus lines agents place risks with any unauthorized insurer?
No agent shall, either knowingly or without adequate investigation of the financial condition and general reputation of the insurer, place insurance under this section with financially unsound insurers or with insurers engaging in unfair practices, or with otherwise substandard insurers, without giving the applicant notice in writing of the deficiencies of the insurer. To be financially sound, an insurer must be able to satisfy standards comparable to those applied under the laws of this state to authorized insurers.
What procedures does a surplus lines agent have to follow?
Every licensed surplus lines agent who procures surplus lines insurance shall forward promptly to the policyholder a completed copy of a surplus lines insurance proposal.
Every new or renewal insurance policy procured and delivered under surplus lines regulations shall bear the name and address of the insurance agent who procured it and shall have stamped or affixed upon it the following:
"This insurance contract is with an insurer which has not obtained a certificate of authority to transact a regular insurance business in the state of Wisconsin, and is issued and delivered as surplus lines coverage pursuant to
s. 618.41 of the Wisconsin Statutes
.
Section 618.43 (1), Wis. Stat.
, requires payment by the policyholder of 3% tax on gross premium."
The policy shall include a description of the subject of insurance and indicate the coverage, conditions, and term of insurance, the premium charged, the premium taxes to be collected from the policyholder, and the name and address of the policyholder and insurer. Upon placing a new or renewal coverage under this section, the agent shall promptly deliver to the policyholder or his or her agent evidence of the insurance consisting either of the policy as issued by the insurer or, if the policy is not then available, a certificate, cover note, or other confirmation of insurance.
Are surplus lines agents permitted to advertise?
All surplus lines agents may advertise availability of their services in procuring, on behalf of persons seeking insurance, contracts with insurers not holding a certificate of authority in Wisconsin, but such advertisements shall not refer to any particular unauthorized insurer or insurers.
What records does a surplus lines agent have to keep?
The surplus lines agent must maintain a record of each surplus lines insurance contract, evidenced by a copy of a daily report and other documents detailed in
s. Ins 6.17, Wis. Adm. Code . Records required to be maintained by the surplus lines agent shall be open at all times to examination by the Commissioner without notice and shall be kept available and open to the Commissioner for five years.
Information Sheet on Surplus Lines Insurers and Agents
Surplus Lines Tax Reporting Requirements