Georgia Surplus Lines flashcards
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32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Surplus Lines Insurance
- Insurance placed with an eligible nonadmitted insurer after a documented diligent search shows authorized insurers will not write the risk or the required coverage.
- Surplus Lines Broker
- A Georgia property and casualty producer holding surplus lines authority who places, services, and reports surplus lines business with eligible nonadmitted insurers.
- Diligent Search
- The documented effort to obtain coverage from authorized insurers before placing with a nonadmitted insurer, including the insurers contacted and the reason each declined.
- Eligible Surplus Lines Insurer
- A nonadmitted insurer that meets Georgia's financial and reporting standards and appears on the Commissioner's approved list for surplus lines placements.
- Nonadmitted Insurer
- An insurer not licensed to transact insurance in Georgia, which may still be used for surplus lines if it qualifies as an eligible insurer.
- Surplus Lines Premium Tax
- The tax imposed on surplus lines premiums that the surplus lines broker collects and remits to the Commissioner with the required return.
- Guaranty Fund Exclusion
- Georgia guaranty association protection generally does not extend to claims against nonadmitted insurers, so written disclosure to the insured is required.
- Written Nonadmitted Disclosure
- The notice to the insured stating the insurer is not admitted in Georgia and that guaranty fund protection does not apply to the policy.
- Unauthorized Insurance
- Transacting insurance in Georgia through an insurer not authorized or eligible, or through an unlicensed producer, subject to fines and criminal penalties.
- Commissioner's Eligible List
- The official roster the Georgia Commissioner maintains of nonadmitted insurers approved for surplus lines placements in the state.
- Surplus Lines License Prerequisite
- An active Georgia property and casualty agent or broker license in good standing is required before surplus lines authority can be granted.
- Nonresident Surplus Lines Reciprocity
- A nonresident holding a home state surplus lines license may obtain Georgia authority when the home state grants reciprocal privileges to Georgia licensees.
- Surplus Lines License Renewal
- Surplus lines authority renews with the underlying P&C license cycle and requires completion of applicable continuing education hours.
- Responsible Licensed Broker
- The designated licensed surplus lines broker accountable for an agency's compliance with search, disclosure, and premium tax requirements.
- Premium Trust Duty
- Surplus lines premiums held by the broker are trust funds and must not be commingled with operating funds or withheld from the insurer.
- Placement Prohibition
- Surplus lines may not be used solely to obtain a lower premium, evade rate or form rules, or insure a risk authorized insurers will write.
- Diligent Search Documentation
- The file record identifying authorized insurers contacted, dates, coverage requested, and the specific reason each declined the risk.
- Eligibility Verification
- Confirmation that the nonadmitted insurer appears on the Commissioner's eligible list as of the binding date, with evidence retained.
- Premium Tax Remittance
- The broker calculates tax on the surplus lines premium at the statutory rate, collects it, and remits it with the required return.
- Return Premium Tax Adjustment
- When a policy is cancelled or endorsed with return premium, the tax base is reduced and the credit is reflected in the next filing.
- Record Retention Requirement
- Search evidence, placement documents, disclosure acknowledgments, and tax records must be kept for the statutory period and produced on request.
- Commissioner's Examination Authority
- The Commissioner may examine surplus lines brokers, require reports, investigate complaints, and impose fines, suspension, or revocation.
- Grounds for Discipline
- Using an ineligible insurer, failing the diligent search, misrepresenting admitted status, commingling premiums, or failing to remit tax.
- Rate and Form Exemption
- Surplus lines placements are not subject to prior approval of rates or forms, but that exemption cannot be used to bypass authorized markets.
- Residual Market Check
- The broker must confirm the risk is not one that must be placed through an assigned risk plan or Georgia residual market mechanism.
- Business Entity Licensing
- A surplus lines agency must hold the appropriate Georgia agency license and designate a licensed surplus lines broker as responsible producer.
- Change Notification Duty
- The broker must notify the Commissioner within the period set by rule of changes in business address, name, or designated responsible producer.
- Advertising Restriction
- A surplus lines broker may not advertise or solicit in a way that implies an unauthorized insurer is admitted in Georgia.
- Eligible List Removal Effect
- When the Commissioner removes an insurer from the eligible list, no new or renewal placements may be made with that insurer.
- Corrective Action Duty
- If a placement is found noncompliant, the broker must cooperate in cancelling or replacing coverage and amending tax filings.
- Surplus Lines Account Record
- A separate record maintained for each surplus lines placement showing the search, insurer eligibility, disclosure, premium, and tax details.
- Annual Surplus Lines Report
- The filing attesting to placements, diligent search compliance, and tax remittance submitted to the Commissioner on the prescribed form.