Georgia Surplus Lines key terms

Coverage placed with an insurer that is not licensed in Georgia, used only after admitted insurers have declined the risk. It fills gaps the standard market will not cover.

A Georgia-licensed producer holding a special surplus lines license who may negotiate and place coverage with nonadmitted insurers. The broker must be appointed and in good standing.

The additional authority a Georgia producer must obtain before placing business with nonadmitted insurers. It is issued in addition to a property and casualty producer license.

An insurer not authorized to transact insurance in Georgia. It may lawfully receive surplus lines business only through a licensed surplus lines broker acting under state rules.

A general term for an insurer lacking a Georgia certificate of authority. Placing business with such an insurer outside surplus lines rules is unlawful and can trigger penalties.

A nonadmitted insurer that meets Georgia's standards to write surplus lines, including capital, solvency, and reporting requirements. Only eligible insurers may be used by surplus lines brokers.

The documented search of admitted insurers before placing a risk in the surplus lines market. Georgia requires evidence that authorized carriers declined or could not cover the exposure.

A written or recorded refusal by an admitted insurer to accept a risk, or a statement that it cannot write it. Declinations support the diligent effort required before export.

A schedule of coverages or classes that Georgia permits to be placed with nonadmitted insurers without a separate diligent search. Placement still requires a licensed surplus lines broker.

A tax on surplus lines premiums, typically collected by the broker and remitted to the state. Georgia also imposes a related tax on the policyholder for nonadmitted coverage.

An additional tax Georgia imposes on the insured for procuring nonadmitted insurance. The surplus lines broker generally collects and remits it with the premium tax filing.

The periodic report a surplus lines broker submits to Georgia listing premium, taxes, and policy details. It keeps the state informed and reconciles taxes due.

An insurer organized outside the United States. Georgia treats such insurers as nonadmitted unless authorized, and they must appear on the state's eligible list to be used.

A segregated fund an alien insurer maintains in the United States to secure its obligations. Georgia considers a qualifying trust when judging whether an alien insurer is eligible.

The licensed surplus lines broker designated on a policy who handles placement, endorsements, and filings. The broker of record is responsible for tax reporting on that policy.

A document confirming that coverage was placed with a nonadmitted insurer and that required taxes were paid. It may serve as evidence of lawful placement.

Authority granted to a producer licensed in another state to act as a surplus lines broker in Georgia. The producer must meet Georgia's application and appointment requirements.

The principle by which Georgia recognizes another state's licensing or surplus lines rules, often under the federal NRRA framework. It affects tax allocation and licensing ease.

The state where the insured maintains its principal place of business, or the state of the risk, for nonadmitted insurance tax purposes. It determines which state collects premium tax.

The broker's record of admitted-market inquiries, declinations, and coverage terms supporting a surplus lines placement. It must be retained and available for examination.

The requirement to keep surplus lines transaction records, including searches and tax filings, for a set period. Georgia regulators may inspect them during examinations.

A regulatory review of a broker's or insurer's business practices, including surplus lines placements and tax compliance. Findings can lead to penalties or license actions.

Ongoing coursework a licensed surplus lines broker must complete to renew authority. Georgia requires CE credits, including ethics, within each renewal cycle.

The periodic process of maintaining surplus lines authority by paying fees and meeting CE requirements. Lapsed authority bars new placements until reinstated.

A formal notice by an insurer or agency authorizing a producer to act on its behalf. Surplus lines brokers must hold the required appointment to place business.

The end of a producer's appointment or license authority, which must be reported to the state. A terminated surplus lines broker may not place new business.

The compensation a surplus lines broker receives for placing coverage. It must be disclosed and is included in premium calculations subject to tax.

Charges a surplus lines broker may add to a transaction, such as policy or inspection fees. They must be disclosed and handled according to Georgia rules.

Informing the insured that coverage is with a nonadmitted insurer and may lack guaranty fund protection. Georgia requires clear written notice before placement.

A state pool that pays claims of insolvent admitted insurers. Surplus lines policies generally are not covered, which is why disclosure to the insured is required.

A state-issued document allowing an insurer to transact insurance in Georgia. Insurers lacking it are nonadmitted and may be used only through surplus lines channels.

The amount the insured pays for coverage, including policy charges and endorsements. Surplus lines premium is the base for calculating state premium tax.

A written change to an existing policy that alters coverage, limits, or terms. Surplus lines brokers must report endorsement premium for tax purposes.

Surplus lines search and declination information that Georgia may treat as confidential and not subject to public disclosure. This encourages honest underwriting information.

The financial and operational criteria a nonadmitted insurer must satisfy to write surplus lines in Georgia. They protect insureds by limiting access to financially sound carriers.

An organization that supports surplus lines brokers with filing services, education, and regulatory coordination. It may assist with tax remittance and eligibility listings.