- New Jersey maintains a list of eligible surplus lines insurers (see Other Comments section #1).
- New Jersey does have a Surplus Lines Association (voluntary participation) but does not have a stamping office (see Other Comments section #2).
- New Jersey does have an export list (see Other Comments section #1 and #6).
- New Jersey does have an industrial insured exemption and has also adopted the NRRA definition of exempt commercial purchaser.
- Surplus lines tax: 5%, payable by surplus lines producer. For fire premiums written in NJ on or after 7/1/09, 3% of the premium receipts tax covering fire insurance should be paid to the Treasurer of the New Jersey State Firemen’s Association, and the remaining 2% of the premium receipts tax to the Commissioner of Banking and Insurance (pursuant to NJ Bulletin No. 09-21).
- New Jersey has not affiliated with any existing compact but Commissioner is authorized to enter into, modify and to terminate the state’s participation in one or more compacts (SB 2930) Effective: July 21, 2011.
Eligibility and Filing Requirements (All Insurers):
Pursuant to N.J.A.C.11:19-3, New Jersey requires all eligible surplus lines insurers to maintain
and file with the Department Of Banking and Insurance a report listing all policies/direct premiums
written for New Jersey insureds. All eligible insurers are requested to submit this information by April 1
using the Surplus Lines Automation Suite/Surplus Lines Information Portal.
Eligibility and Filing Requirements (Alien Insurers Only):
None, alien insurers only need to be on IID list.
Eligibility and Filing Requirements (Foreign Insurers Only):
- Letter of Intent.
- Annual Statement.
- Certificate of Compliance from state of domicile (must be filed annually with the DOI)
Types of Insurance Exempted from Surplus Lines Regulation:
- Railroad or aviation risks engaged in interstate or international commerce.
- Insurance of vessels, crafts or hulls, cargoes, marine builders’ risks, marine protection and indemnity or other risks including strikes and war risks commonly insured under ocean or wet marine forms or policies.
Other Comments or Requirements:
- Eligibility and export lists available at http://www.state.nj.us/dobi/sleo.htm.
- New Jersey Surplus Lines Association website is www.njsla.org.
- Effective 2003, New Jersey eliminated the form approval requirements for surplus lines policies which brings New Jersey in line with all other states in providing surplus lines carriers freedom of form.
- At the time of quotation, the originating producer shall provide to the applicant a copy of the form incorporated herein by reference as Exhibit A-1 in th
Appendix to this chapter and retain a signed copy.APPENDIX EXHIBIT A-1
Form to be used at the time of quotation:
The undersigned applicant has been advised by the undersigned originating insurance producer and understands that an insurance policy written by a surplus lines insurer is not subject to the filing or approval requirements of the New Jersey Department of Banking and Insurance. Such a policy may contain conditions, limitations, exclusions and different terms than a policy issued by an insurer granted a Certificate of Authority by the New Jersey Department of Banking and Insurance.
Applicant’s Name Print or Type)
Date of Applicant’s Signature
Producer Name (Print or Type)
Date of Producer Signature
New Jersey Producer License Reference Number
- The following statement must appear on all Surplus Lines Policies, Evidence of Coverage and Renewal Policies or be provided or as a standalone notice:
“This policy is written by a surplus lines insurer and is not subject to the filing or approval requirements of the New Jersey Department of Banking and Insurance. Such a policy may contain conditions, limitations, exclusions and different terms than a policy issued by an insurer granted a Certificate of Authority by the New Jersey Department of Banking and Insurance. The insurer has been approved by the Department as an eligible surplus lines insurer, but the policy is not covered by the New Jersey Insurance Guaranty Fund, and only a policy of medical malpractice liability insurance as defined in N.J.S.A. 17:30D-3d or a policy of property insurance covering owner-occupied dwellings of less than four dwelling units are covered by the New Jersey Surplus Lines Guaranty Fund.”
- New Jersey amended its export list in 2009 to add “special risk disability and personal accident coverage” and “livestock gross margin policies” to the list.
- New Jersey enacted legislation in 2011 to allow a domestic insurer possessing policyholders’ surplus of at least $15 million may, pursuant to a resolution by its board of directors, and upon the written approval of the Commissioner of Banking and Insurance, to be designated as a domestic surplus lines insurer. Under this legislation, the domestic surplus lines insurer is precluded from writing policies of private passenger automobile insurance, worker’s compensation, or worker’s occupational disease insurance. Insurance written by a domestic surplus lines insurer would also be subject to the 5% surplus lines tax.
This legislation also provides that whenever any insurance risk or any part thereof is placed with a domestic surplus lines insurer, the policy, binder or cover note needs to bear conspicuously on its face in boldface, the following notation: “Notice to Policyholder: This policy is written by a domestic surplus lines insurer, an eligible unauthorized insurer pursuant to Section 2 of P.L.c(C) (pending before the New Jersey Legislature as this bill), and is not subject to the rate or form filing or approval requirements of the New Jersey Department of Banking and Insurance. This policy may contain conditions, limitations, exclusions and different terms than a policy otherwise issued by a New Jersey authorized or admitted insurer. This policy is not covered by the New Jersey Property Liability Guaranty Association. This policy may be covered by the New Jersey Surplus Lines Insurance Guaranty Fund, but only to the extent provided pursuant to Section 2 of P.L. 1984(c.101(C). 17:22-6.71).”
- The New Jersey Department of Banking and Insurance in 2012 promulgated New Rule N.J.A.C. 11:1-28.4A which conforms the existing rules in New Jersey governing surplus lines allocation, eligibility, and procurement to the NRRA. The purpose of the new rule is to help avoid any confusion regarding the application of the New Jersey Insurance Department’s rules in light of the enactment of the NRRA. The new rule also sets forth requirements for a domestic property/casualty insurer to be designated a domestic surplus lines insurer pursuant to N.J.S.A. 17:22-6.69b.
- New Jersey updated its export list in 2014 to include private flood insurance. This was the only addition to the list, and there were no deletions.