 |
 |
||
|
|
|||
In today’s era of increasing uncertainty NAPSLO is continuing to work, and make progress, on the important challenges, changes and opportunities facing our industry.
Recently more than 20 NAPSLO representatives traveled to Washington, D.C. as part of our third annual Legislative Day. We had very positive meetings with top members of the House and Senate committees and we continued to find support and growing momentum for our initiatives.
We have come a long way since February 2004 when four NAPSLO representatives first traveled to Washington to "plant the NAPSLO flag." Since then we have made great strides and with the additional efforts of our Washington lobbyist, B&D Consulting, we have been able to raise the visibility of our segment of the industry and our issues are now considered a priority by Washington representatives.
Our legislative efforts rely on help from the NAPSLO PAC and cannot be as effective without donations from our generous members. To streamline the contribution process we are looking at the ability to offer online credit card donations to the PAC.
NAPSLO is uniquely positioned to continue to make a positive difference for its members, and we continue to take several important steps to that end.
Adding online features is part of our efforts to improve our electronic interaction with our members. Recent accomplishments include our redesigned website, new electronic newsletter, and updated e-News. In addition our marketing campaign to promote wholesalers has led to the formation of a Speakers Bureau to further educate our customers about our segment of the industry.
I am also pleased to report that we recently published an annual report that provides a consolidated review of the Association’s activities. A copy was mailed to all NAPSLO members and it is also available to download from the website.
In addition to our legislative and communications efforts, we have been busy on the education front, recently naming 13 interns selected to spend this summer with NAPSLO broker and company members as part of our summer internship program. The top two interns will receive an additional internship in London or Bermuda in 2010.
The first Executive Leadership School in February was successful with more than 20 people taking part in the advanced level seminar. I participated in the Leadership School and was pleased to see all of the attendees engaged in the process and learning ways for their firms to improve their decision making skills. NAPSLO will be offering the program again next year and I encourage members to give their employees a change to enhance their leadership skills and send them to the school.
We now offer educational programs at all levels and registration for our E&S School, designed for people with less than five years experience in the industry, is currently underway. The school will take place June 23-26 in St. Louis.
In addition to the schools, the Derek Hughes/NAPSLO Educational Foundation continues to support the Associate in Surplus Lines Insurance (ASLI) designation. Since the first class was conferred at the 1998 NAPSLO Annual Convention in Orlando more than 1,500 students have received the designation and there are 21 new designees already this year.
NAPSLO returns to Orlando in October so mark your calendar now to attend the 2009 Annual Convention. Registration materials will go out in early June and members will again be able to register online through the NAPSLO website.
While these are challenging times much has been accomplished this year. With your continued support, NAPSLO will continue to make a profound, positive difference for its members and our industry. I believe as an association we are well positioned to face the challenges, changes and opportunities of the future and will continue to be a leader of the industry.
NAPSLO Saddened by Passing of Mary Ellen Rozzell It is with deep sorrow and sadness that we note the passing of our friend and NAPSLO Past President, Mary Ellen Rozzell.
Mary Ellen suffered a brain hemorrhage while attending the NAPSLO Mid-Year Workshop meeting in Indian Wells, California.
She was taken to Eisenhower Medical Center in Rancho Mirage, California, where surgery was performed. Mary Ellen was placed on life support and passed away peacefully on March 3.
Mary Ellen began working in the Excess & Surplus Lines business with the Marmorstein Agency some 40 years ago. She had been serving as President of Continental/Marmorstein & Malone and was the immediate Past President of NAPSLO.
Mary Ellen loved her job and had made many lifelong friendships with companies, agents and associates in our industry. She was a remarkable woman and will be missed by all.
Congressional Recognition Mary Ellen's career and work in the surplus lines industry was recognized in resolutions published in the Congressional Record on March 11 sponsored by Rep. Scott Garrett (R-NJ) and on March 19 by Sen. Robert Menendez (D-NJ).
Donations "The Mary Ellen Rozzell Foundation for AVM Research" has been established. Donations can be made payable to the foundation and sent to Continental Marmorstein & Malone, c/o Sue Bishop Mischler, 305 Route 17 South, Paramus, NJ 07652.
NAPSLO Launches Redesigned Website NAPSLO recently launched its enhanced website, www.napslo.org . The new site incorporates a modern design and contains user-friendly access to videos and important industry topics in a more streamlined manner.
NAPSLO's goals were to modernize and enhance the current website to reach the membership and external communities and also to provide information to prospective industry employees. A separate redesigned site dedicated to careers and internships is being discussed for the future.
The new website provides a more interactive avenue of navigation, including a Flash-based homepage design, along with embedded videos containing pertinent industry information. In addition, users will find main subjects listed along the left vertical navigation menu. When users mouse over a topic, drop-down menus appear, listing sub-menu items more clearly. There is also a horizontal utility bar along the top of the website, providing easy access to the Member Login and Member Locator functions.
In addition, the homepage is now equipped to be updated with notable articles, links and videos that are more easily accessible. The NAPSLO News will also be featured electronically on the new website on a monthly basis, versus the hard copy published and printed bi-monthly in the past.
NAPSLO E&S School - Space Available There are still spots available in the NAPSLO E&S School, scheduled for June 23-26 in St. Louis. The cost of the school is $1,200 and the registration deadline is May 15.
The curriculum focuses on five segments: Risk Takers-and various markets; Distribution System - purpose & variations; MGAs and Brokers - managing the business; Market Dynamics - changing environments; and Cops - regulatory agencies.
In addition to the above topics, Steven DeCarlo of AmWins will present Perspectives From the Top, and there will an Executive Panel featuring:
Registration Requirements The NAPSLO E&S School is designed for insurance professionals with less than five years experience in the surplus lines industry. Persons with more than five years surplus lines experience are encouraged to attend the NAPSLO Advanced School, offered each Fall.
Hotel Accommodations Attendees will stay at The Parkway Hotel, 4550 Forest Park Blvd., located on the campus of Washington University Medical Center.
Session Location The Eric P. Newman Education Center is within walking distance of the hotel. After hotel check-in, attendees should stop by the NAPSLO registration desk (in the hotel lobby) to pick up class materials. All sessions will take place at the Newman Education Center.
Mid-Year Educational Workshop Recap Approximately 500 people attended the 2009 NAPSLO Mid-Year Educational Workshop in late February at the Renaissance Esmeralda Resort in Indian Wells, CA.
Programs started with Lonzetta L. Newman, M.D., discussing cancer research and the MD Anderson Cancer Center. Dr. Newman is an assistant professor of medicine in the Department of Clinical Cancer Prevention, Division of Cancer Prevention and Population Sciences of The University of Texas MD Anderson Cancer Center.
Following her presentation on Friday was a legislative panel consisting of Maria Berthoud, B&D Consulting and Richard Bouhan and Steve Stephan of NAPSLO. They discussed the Nonadmitted and Reinsurance Reform Act (NRRA) and other current topics regarding the legislative landscape.
Saturday featured three programs, which were offered in smaller settings and were repeated so attendees could select among the programs depending on their interests. The programs were:
Steve Player, The Player Group
Conquering the Legal World of Human Resources Jonathan Siegel, Jackson Lewis LLP
Technology - Insights and Tips for Productivity Chris Cogburn, Colemont Insurance Brokers
On a related education matter, NAPSLO recently teamed up with the Success Family of CE Companies to begin offering a web-based continuing education program for NAPSLO members. The system was demonstrated during the Mid-Year Educational Workshop.
The Workshop concluded with a wine and cheese tasting presentation. Sommeliers customized the evening with a tasting experience that included local, regional and international wines, paired with imported cheeses.
Cancer - The 'C' Word Dr. Lonzetta Newman's presentation at the Mid-Year Educational Workshop reviewed current cancer research.
"We hope today that you will learn more about cancer and hopefully this will alleviate any fears that you may have when you hear the "C" word," Newman began.
In the last 60 years, the MD Anderson Cancer Center in Houston has built a worldwide reputation for excellence in cancer patient care, research, education and prevention. The center was named for Monroe Dunaway Anderson who was born in 1873 and was a banker before becoming president of Anderson, Clayton & Co, which came to be the world's largest merchant of cotton, the world's most popular commodity. For nearly a century, it was known as "King Cotton" in Texas and other states.
Dr. Newman said that in 1936, M. D. Anderson created the charitable foundation which bears his name and funded it with about $300,000. This foundation was destined to receive $19 million after Monroe's death in 1939.
In 1941, the Texas legislature authorized the University of Texas to establish a hospital for cancer research and treatment. The Anderson Foundation matched the legislature's funding to create the center in Houston. In 1946, Randolph Lee Clark, M.D., took charge of the institution and lifted it to great heights in terms of successful operation and worldwide recognition.
Dr. Newman noted that scientists and clinicians at MD Anderson are accelerating their diverse research. The MD Anderson Cancer Center has outlined a few key steps toward reducing the risks for certain cancers.
Numerous Legislative Issues Facing Surplus Lines Industry The surplus lines industry still faces a difficult task in promoting its issues at the federal and state levels this year, especially since legislators are focused on the continuing economic problems. This was one point made by the panelists at the Our 2009 Industry Landscape, Legislation and Politics program at the Mid-Year Workshop.
During the program, NAPSLO Executive Director Richard Bouhan, Director of Legislative Relations Steve Stephan, and Maria Berthoud of B&D Consulting, reviewed current federal and state issues.
Ms. Berthoud said that economic issues were currently at the forefront of Congress, and one of their major concerns is how to prevent future problems such as arose with AIG. One proposed solution is to create a systemic risk regulator under the direction of the Federal Reserve.
The impact of AIG problems is affecting a number of financial institutions and currently, many banks are undergoing stress tests to see if they are solvent and can survive. While these issues may not directly impact the industry, Ms. Berthoud said the issues could make it difficult for Congress to give attention to surplus lines concerns.
She reviewed the progress of the previous versions of the Nonadmitted Reinsurance and Reform Act (NRRA) in the 109th and 110th Congressthat were sponsored by Rep. Dennis Moore (D-KS) and Rep. Ginny Brown-Waite (R-FL). Rep. Moore and Rep. Scott Garrett (R-NJ) have announced they will introduce the bill in the House in the 111th Congress.
The House passed the NRRA in its two previous sessions and the Senate Banking Committee held a hearing on the bill in July 2008, where Mr. Bouhan testified. Ms. Berthoud noted that during the Senate hearings industry representatives were asked if they could support the surplus lines bill, and all said "yes", showing the strong support for the bill.
Ms. Berthoud said that a coalition of surplus lines firms and organizations has been formed to keep the industry focused and working together as part of the effort to get the bill through both the House and Senate.
She mentioned that a number of issues, including TARP, the Madoff ponzi scandal, the auto bailout, and the review of Fannie Mae and Freddie Mac are currently occupying the Senate Banking Committee.
"We have our work cut out for us to pull our bill out of the middle of all of this, but we are hoping to be successful," she said.
On the House side, Ms. Berthoud noted that in addition to the NRRA, the House Financial Services Committee is reviewing a number of items. Included are a new version of the Optional Federal Charter bill, formation of an Office of Insurance Information, and review of the Risk Retention Act and NARAB.
Mr. Bouhan noted that while NAPSLO continues to make progress on its issues and a lot of work had been done during the past five years since the first NAPSLO representatives visited Washington, D.C. in February 2004.
"We realized at the time that if we were really going to progress with this, we would need a full-time voice in Washington and we needed to have a lobbyist," Mr. Bouhan said. "What supports their efforts is the NAPSLO PAC."
Mr. Bouhan noted that contributions by the PAC had, with one exception, been made to successful candidates in 2008. He said the PAC backs candidates from the major committees reviewing surplus lines legislation who share the industry's views.
On the state side, Mr. Stephan reviewed the current issues and outlined three trends at the state level: more regulation of personal lines in surplus lines insurance; states seeking more medical malpractice data; and proliferation of licenses for surplus lines brokers.
Mr. Stephan said the problem with data collection is that the information is not comparable, as it is inconsistent and would be difficult to offer a 50 state comparison. He said state requirements in some cases can lead to needing 50 licenses for a 50 state risk, which the states may not realize could help promote a push for federal regulation.
In addition, Mr. Stephan reviewed the current status of the Zota v. Essex case regarding what constitutes delivery of a policy. In that 2008 case, the Florida Supreme Court ruled that delivery of the policy from the broker to retailer constitutes delivery for the broker even if it wasn't delivered to the customer.
The major part of the case was the ruling that said while the statute included language that the chapter involved did not impact surplus lines, the court said that was only because of a transcription error, and the rules did involve surplus lines.
To remedy this situation, NAPSLO and a number of organizations are currently working with legislators on a bill.
Alternatives to Budgeting Process Reviewed Traditional budgeting can provide disincentives to business, and firms should look at moving toward developing targets and adjusting to meet those goals, according to Steve Player of The Player Group.
Mr. Player, who presented Stop Budgeting and Start Running Your Business at the Mid-Year Workshop, has been involved with an industry group working on research into the next generation of budgeting.
He said traditional budgeting has five planning steps: setting targets; providing incentives to reach those targets; developing action plans; allocating resources; and coordinating plans among the various departments.
"What's wrong is that in traditional practice, what happens is that this morphs into a performance contract, a fixed performance contract," he said. "If there is one thing that takes budgeting and makes it a perverse process, it is that negotiations tie incentives to hitting a budget. When you pay people to hit a negotiated target, you change from pay for performance to pay for negotiated results."
He said that this method encourages people to negotiate targets that are easily met rather than ones that deliver outstanding performance. As a result, current budgeting processes can encourage people to do the wrong things, such as selling at a wrong price to increase total sales.
Mr. Player said the traditional budgeting process has seven problems: it takes too long to prepare; it costs too much; it is based on assumptions that are almost always wrong; it can cause gaming of the system; it triggers unnecessary spending; it gives an illusion of control; and it brings out unproductive behavior.
One of the biggest problems is that people base budgeting on assumptions that are difficult to determine, Player said. As an example, he reviewed the swings in the price of oil over the past year from $100 a barrel to $140 and eventually to $40.
"Think anyone predicted that?" he asked. "There are things you cannot predict."
Mr. Player suggested that organizations stop wasting time in budget discussions and instead create an adaptive plan for running the organization and constantly adjusting the organization based on the latest and best information. He compared it to developing a flight plan for a plane, where the pilot, after taking off, makes adjustments to situations as they arise.
Mr. Player said options are to develop plans on where the organizations are going and then review how they are working to meet those objectives. He said the three common keys to success are: a move to continuous planning and adaptive controls which requires enlightened leadership; a commitment to change culture and behaviors as well as processes; and utilizing fast, open information systems.
Conquering the Legal World of Human Resources Attorney Jonathon Siegel, Jackson Lewis LLP, presented information surrounding the legal world of human resources during the Conquering the Legal World of Human Resources presentation at Saturday at the Mid-Year.
Mr. Siegel began by explaining the 2008 amendments to the Americans with Disabilities Act. The amendment defines an impairment as a disability even if it is episodic and in remission however would substantially limit a major activity when active. Presently, EEOC regulations provide that "substantially limits" means the individual is unable to perform a major life activity or is significantly restricted as to the condition, manner or duration under which one can perform a particular life activity, as compared to the average person in the general population.
Except for ordinary eyeglasses and contact lenses, the ADA prevents courts and employers from considering mitigating measure an individual may be using when determining whether or not they are disabled. "Therefore, it is quite likely that many with conditions of diabetes, high blood pressure, carpal tunnel and cancer will have a "disability" under the ADA, which may then place an affirmative obligation on an employer to provide reasonable accommodation," said Mr. Siegel.
He said what ultimately may be the most profound change to the ADA is the definition of an individual "regarded as" having a disability. The ADA would hold an employer liable under a "regard as" theory if the individual can show discrimination because of an actual or perceived physical or mental impairment, whether or not the impairment actually limits or is perceived to limit a major life activity.
"In a lawsuit, the plaintiffs only need to establish that the employer had a mistaken belief about the individuals ability to perform his or her job, not a broad class of jobs or other major life activities," said Mr. Siegel.
Mr. Siegel next discussed avoiding costly mistakes regarding wage and hour issues. Some common pitfalls include failing to compensate employees for travel time during the continuous workday, failing to combine hours an employee works at all of an employer's work sites, violating child labor Hazardous Occupation Order 12, failing to pay for pre- and post-shift work activities, failing to pay overtime to salaried non-exempt employees, failing to include all required compensation in the employee's regular rate, and mis-designating employees as independent contractors.
Concluding his presentation, Mr. Siegel outlined the steps for proper termination and discipline. First, a proper investigation must take place and detailed documentation should be kept.
"Goals of a successful investigation include being responsive to an employee concern, making personnel change where necessary, improving behavior, reaching a conclusion to the complaint and creating a record of response," Mr. Siegel said. Next, an alternative to termination should be considered because termination is not always the appropriate action under state and federal law and also to avoid costly wrongful termination lawsuits. If an alterative is still not an option, then a termination meeting should be planned, keeping confidentiality, timing of the meeting, final compensation and fair treatment of the employee in mind, concluded Mr. Siegel.
BlackBerry Tips Chris Cogburn, Information Technology Manager for Colemont Insurance Brokers, presented tips and tricks for BlackBerry use during the Mid-Year Saturday sessions. Mr. Cogburn discussed various shortcuts and helpful knowledge for even the savvy BlackBerry user during his presentation Technology - Insights and Tips for Productivity.
Some of the important tips he outlined were:
For the entire presentation of tips and tricks, please click here.
Games, Ring tones, Wallpapers, etc. - http://mobile.blackberry.com/ Google Search, Gmail, Maps, News - http://mobile.google.com/ BlackBerry Internet Service (e-mail forwarding) - http://www.blackberry.com/support/client/ Tips for other BlackBerry devices - http://na.blackberry.com/eng/support/blackberry101/tips/
Legislative Report NAPSLO leaders said they were optimistic about passage of the Nonadmitted and Reinsurance Reform Act (NRRA) after more than 20 NAPSLO representatives visited with Members of the Senate Committee on Banking, Housing and Urban Affairs and House Financial Services Committee on March 24 to discuss surplus lines issues.
During the meetings, NAPSLO representatives spoke with Senator Evan Bayh (D-IN), who along with Sen. Mel Martinez (R-FL), announced plans to introduce a version of NRRA. The visits were part of NAPSLO's fourth annual "Day on the Hill" and members representing NAPSLO brokers and insurers met with almost all Members or staff on the Senate Banking Committee, and also with Leadership on the House Financial Services Committee.
Attending the meetings were: NAPSLO President John Wood, Legislative Committee Co-Chairs Hank Haldeman and Tom Mulligan; Board members Letha Heaton, Tim Makowski, and Kevin Westrope; Legislative Committee members Michael Byrne, Paul DeCotis, David Ertel, Brian Evans, Michael Johnston, Bill Malone, Bobby Owens and Ted Pierce. Also attending were NAPSLO Executive Director Dick Bouhan, Director of Government Relations Steve Stephan and B&D Consulting representatives Josh Andrews, Libby Baney, Maria Berthoud and Jonathan Dilley.
"With the leadership of Senators Bayh and Martinez on surplus lines reform, there is renewed hope that this important piece of legislation will pass," said NAPSLO President John Wood. "This bill was approved unanimously by the House of Representatives the past two sessions and based on our discussions with Members of Congress we are encouraged that the bill will be introduced and passed by Congress."
The Nonadmitted and Reinsurance Reform Act (NRRA) is aimed specifically at streamlining and reducing barriers in state regulation of surplus lines insurance and reinsurance. It would create a uniform system, while preserving the role of the state regulator.
"We believe this bill will solve a number of regulatory problems by establishing federal standards for state regulation, while retaining the state regulation that avoided many of the problems seen in the recent crisis," said NAPSLO Executive Director Richard Bouhan. "The bill enjoys broad support within the industry and we look forward to its passage."
In February, Rep. Dennis Moore (D-KS) and Rep. Scott Garrett (R-NJ) of the House Committee on Financial Services announced that they would take the lead in introducing the NRRA in the House. The NRRA is similar to bills passed by the House in the 109th and 110th Congress. The NRRA was also introduced in the Senate in the 110th Congress and the Senate Banking Committee discussed the bill in a hearing on insurance regulation in July of 2008. Chairman Dodd indicated his intent to move the bill at last summer's hearing but the financial crisis prevented further consideration of the bill by the Senate in 2008.
"We are encouraged by our discussions with Members of Congress and believe the bill has a good chance to be approved," said Maria Berthoud of B&D Consulting, which represents NAPSLO in Washington. Berthoud added "the new leadership of Senator Bayh has given the bill added momentum."
Legislative Report State Legislative Roundup
Alaska Alaska Bulletin 08-08 contains surplus lines premium codes for surplus lines monthly summary premium reports effective as of Dec. 12, 2008. The premium reporting forms have been updated and are on the Alaska Division of Insurance website.
Arkansas Arkansas SB 806, a bill that would require surplus lines brokers to provide claim information to policyholders, has been signed into law.
California California has proposed to adopt section 16031, also known as the Emergency Response Initiative Trailer Bill. The bill requires an assessment on residential and commercial fire and multiperil polices to fund services such as fire protection. The assessment also applies to surplus lines insurance and is to be collected by the surplus lines brokers.
California Section 1765 will require training for surplus lines producers, including non-resident producers. The SLA website at www.sla-cal.org should have information about the training in the near future.
Connecticut Connecticut ADC 38a-740-6 is a notice of intent to amend the regulations to permit electronic filing of surplus lines insurer's annual statements.
Connecticut SB 961 is a bill that would require Medical malpractice data reporting by surplus lines insurers.
Florida FL (HB 853 and SB 1894) - The legislation proposed as a solution for Essex v. Zota case passed the House Banking Committee without amendments. In the Senate Banking and Insurance Committee hearing on March 25, however, an amendment was tacked on, over the objection of industry lobbyists, adding numerous consumer protection provisions that were not previously applicable to surplus lines insurance. With respect to the issue of retroactive application of the bill, the Senate amendment was intended to permit the existing lawsuits based upon Zota to proceed, but cut off lawsuits filed after the bill becomes law. Unfortunately there was some concern that the language of the amendment would have the unintended effect of applying the consumer protection provision enumerated in the bill retroactively to 1988. This apparent drafting error was mentioned at the hearing, but the amendment nevertheless passed 5-4. The Senate Judiciary Committee struck the amendment and added a subsequent amendment at a hearing on April 1. The Judiciary Committee amendment contains many of the same consumer protections, but clarifies the retroactive application of the bill. The substitute amendment is available to download.
The amendment is supported by the Florida Surplus Lines Association, the American Insurance Association, the Property Casualty Insurers Association of America, and the Florida Insurance Council.
Florida HB 1157 is a bill that would convert the Florida Hurricane Catastrophe Fund into a state-run residential hurricane insurer. The program initially would provide hurricane coverage on all residential structures valued at up to $2 million, with private insurers, including, Citizens Property Insurance Corporation, providing coverage for all other perils. The legislation establishes a transition intended to reestablish Citizens as the insurer of last resort in all-other-perils coverage, following transfer of Citizens hurricane exposure to the Florida Hurricane Protection Program.
Florida HB 1171 is a bill that would permit non-assessable policies for residential property to be exempt from rate limits and rate reviews by the state. These policies would be exempt from the emergency assessment from the Florida hurricane catastrophe fund and Citizens Property Insurance Corporation. NAPSLO objected to a similar bill last year because surplus lines insurers are already exempt from rates and this bill appears contrary to the intent of the Cat Fund and Citizens laws. The bill did not advance last year, presumably because it would impact the number of policies subject to assessments.
Florida SB 410 is a bill that requires that any line of insurance offered in any state must be offered in Florida. The bill does not address surplus lines insurance, but mentions only "an insurer."
Hawaii Hawaii HB 1074 would prohibit a surplus lines broker from writing life insurance, accident and health insurance and annuity products.
Louisiana Legislation proposing to allow only one deductible per year for homeowners insurance has been drafted and the state reportedly intends for it to apply to surplus lines insurance. It has not been introduced so there is no bill number at this time. NAPSLO, the Louisiana Surplus Lines Association, and the AAMGA jointly submitted a letter objecting to the application of the proposed law to surplus lines insurers.
Louisiana Bulletin 08-01 eliminated a cap on taxi rates, but acknowledged that the code required taxi rates be filed by surplus lines insurers. NAPSLO has requested that the legislation be amended to remove the filing requirement for surplus lines insurers.
Missouri Missouri SB 464 would create a two-year license for surplus lines brokers and amend the quarterly reporting requirements for surplus lines brokers.
Mississippi Mississippi SB 2858 extends the repealer of the immunity for the Board of Directors of the stamping office. It has been sent to the Governor for signature. The immunity for the board would be extended to 2012.
New Jersey The Piermount Iron Works v. Travelers case, 963 A.2d 818 (NJ 2009) reversed a lower court decision and held that the cancellation and non-renewal laws were not applicable to a surplus lines insurer.
New Jersey proposed amendment to AC 11:17B-3.1 provides that the prohibition on broker fees continues to apply to personal lines insurance, but this amendment would permit brokers to charge fees for services rendered in connection with commercial lines policies. Policy Fee restriction, unrelated to a service fee, continue to apply to surplus lines.
New York The department has drafted producer compensation transparency disclosure guidelines (Jan. 29, 2009 draft). The guidelines specifically exempt surplus lines wholesalers from the disclosure requirements.
New York S290 is a bill that would impose coverage terms and limits upon public vessel liability insurance. It is intended to apply to surplus lines insurance.
The Excess Lines Association of New York has set a meeting with the Department of Insurance on April 24 to discuss amending Regulation 41 to provide that declinations are valid for the greater of a certain number of months or the term of the policy. ELANY is also proposing other reforms to reduce regulatory burdens on brokers. The next export list hearing scheduled by the department is Aug. 6, 2009.
Oklahoma Oklahoma SB 700 is a bill that would allow for compulsory auto liability insurance for commercial auto to be issued by surplus lines insurers.
Oklahoma SB 1022 is a bill that amends the Medical Malpractice closed claim reporting requirements. The definition of "insuring entity" in the bill includes "an unauthorized insurer that provides surplus lines coverage."
Rhode Island Rhode Island Reg. 11 has been proposed to provide that brokers no longer have to file the affidavits with the Department. The affidavit must be completed, and are subject to audit by the Department, but filing is no longer required.
Texas Texas HB 3978 is a bill proposing the implementation of a surplus lines export list.
Washington Washington HB 1568 would amend several portions of the surplus line code. The bill adds detail regarding the bonds, the license application and license renewals. The bond requirements continue to be imposed on non-resident surplus lines brokers. This would appear to preclude the state from being certified by the NAIC as Gramm Leach Bliley compliant.
Medicare Secondary Payer A recent change in the Medicare law (42 USC 1395 y(b)(8)) would require reporting from liability insurers, including no-fault auto liability, self insurers, and workers compensation insurers when claim payment are made to injured persons who are eligible for Medicare. The law would require reporting for liability insurers beginning July of 2009. The language of the bill does not expressly apply to surplus lines insurers or expressly exempt surplus lines insurers. At least one surplus lines insurer has concluded that the new reporting requirements would apply to surplus lines insurers. NAPSLO will follow the developments as it is potentially burdensome for surplus lines insurers to determine which claimants are Medicare eligible and then file a report.
The following links provide more information on the topic:
The NAIC Multi-State Tax Working Group held a call on Feb 26, 2009 to discuss a survey of the states regarding various regulatory issues involving surplus lines insurance. The survey should be released to the regulators soon. The survey is intended to identify which regulatory matters are set by statute and which matters are set by department policy. The issues that are set by department policy could possibly be addressed by a uniform tax reporting form while those that are set by statute would require an act of the legislatures. One of the goals of this group is to investigate the feasibility of a uniform tax reporting form.
Surplus Lines Law Group The Surplus Lines Law Group, an informal group of in-house attorneys, compliance professionals and outside counsel that reviews current legal issues in the surplus lines arena, met March 27 in San Francisco. An agenda of the meeting is available to view and if you would like to be put on a mailing list for notice of future surplus lines law group meetings, please contact Steve@napslo.org.
NAPSLO selects 13 as 2009 summer interns NAPSLO selected 13 students to participate in the Association's 2009 Summer Internship Program. Selected interns participate in an extensive program, spending five weeks with a NAPSLO member surplus lines insurance company and four weeks with a NAPSLO member wholesale broker. At the end of the program, several interns will be invited to attend the annual convention in the fall.
2009 NAPSLO Summer Interns
Upcoming Events 2009 E&S School - June 23-26 St. Louis, MO 2009 Annual Convention - October 7-10 - Orlando, FL 2010 Mid-Year Educational Workshop - March 3-7 - Scottsdale, AZ
|
|
|
|
