General Information:

  1. North Carolina maintains a list of eligible surplus lines insurers (see Other Comments section #1).
  2. North Carolina does have a Surplus Lines Association (see Other Comments section #2).
  3. North Carolina does not have an Export List.
  4. North Carolina does not have an industrial insured exemption but has adopted the NRRA exempt commercial purchaser exemption (§ 58-21-16(b)(1)).
  5. Surplus lines tax: 5%, payable by broker.
  6. North Carolina has not affiliated with any existing compact (SB 321).

Eligibility and Filing Requirements (All Insurers):

Fees: $500 (initial filing) and $1,000 (annual renewal).

Eligibility and Filing Requirements (Alien Insurers Only):

  1. Alien surplus lines insurers are expected to file audited financial statements within six months after their fiscal year end. These financial statements should be reported in United States currency.
  2. A surplus lines broker may place insurance with an alien insurer if that insurer is listed on the Quarterly List of Alien Insurers maintained by the NAIC. § 58-21-17.

Eligibility and Filing Requirements (Foreign Insurers Only):

  1. If the insurer’s annual statement for the most recent December 31 is filed electronically with the NAIC, the NC DOI will no longer require a hard copy of the annual statement to be filed. However, each eligible surplus lines insurer must file a hard copy of its certificate of compliance and verification of deposit from the state of domicile.
  2. A surplus lines broker may place insurance with a nonadmitted insurer if:
  • The insurer is authorized to place that type of insurance in its domiciliary jurisdiction; and
  • The insurer has capital and surplus, or its equivalent under the laws of its domiciliary jurisdiction, that is the greater of the minimum capital and surplus requirements under the laws of this state or $15 million.

The insurance commissioner may waive the minimum capital and surplus requirements for unauthorized foreign insurers if he makes an affirmative finding of acceptability after considering: quality of management, capital and surplus of a parent company, company underwriting profit and investment trends, market availability, and company record and reputation within the industry. The commissioner may not make a finding of acceptability if the insurer’s capital and surplus is under $4.5 million. § 58-21-20.

Types of Insurance Exempted from Surplus Lines Regulation:

Aviation insurance/wet marine and transportation insurance.

Other Comments or Requirements:

  1. Eligibility list available at http://www.ncdoi.com/CA/CA_Surplus_Lines.aspx.
  2. Contact information for the North Carolina Surplus Lines Association is as follows:
    Elaine Christian, Executive Director
    North Carolina Surplus Lines Association
    P.O. Box 41368
    Raleigh, North Carolina 27629-1368
    Phone: (919) 876-0687
    Website: www.ncsla.com.
    Select “Surplus Lines” from the menu on the left, and select “List of Authorized Surplus Lines Companies”.
    In 2015, North Carolina also authorized the creation of the North Carolina Stamping Office, making it the 15th stamping office in the nation.
  3. North Carolina provides for an affirmative finding of acceptability by the Commissioner based on stated factors pertaining to companies with $4,500,000 to $14,999,999 combined capital and surplus.
  4. Lloyd’s plans or other similar unincorporated groups individual insurers must maintain an irrevocable trust fund of not less than $50,000,000 as security for all policyholders and creditors in the United States of each member of the Group. This trust fund must be held in a national bank or a member of the Federal Reserve System and must have an expiration date which at no time shall be less than five years in the future.
  5. Insurance exchanges created by the laws of individual states must have and constantly maintain total capital and surplus, or the substantial equivalent thereof, of not less than $50,000,000 in the aggregate. Each individual syndicate must have and constantly maintain total capital and surplus, or the substantial equivalent thereof, of not less than $3,000,000.
  6. Renewal Application and Instructions may be processed through the North Carolina Insurance Department’s website by going to www.ncdoi.com and selecting “Industry” at the top of the page.
  7. Each eligible surplus lines insurer underwriting service contract reimbursement or contractual liability insurance policies for service agreement companies pursuant to Article 1 of Chapter 58 must file the policies directly with the NC DO I’s Property and Casualty Division for approval prior to being used for any purpose in NC in accordance with NAGS 58-1-36.
  8. Each eligible surplus lines insurer is expected to notify the NC DOI of all corporate changes within the company, including changes in the United States Attorney-in-Fact for alien insurers.
  9. Every evidence of insurance negotiated, placed, or procured by the surplus lines licensee must bear the name of the licensee and the following legend in 10-point type and in contrasting color:“The insurance company with which this coverage has been placed is not licensed by the State of North Carolina and is not subject to its supervision. In the event of the insolvency of the insurance company, losses under this policy will not be paid by any State insurance guaranty or solvency fund.”
  10. On November 18, 2015, the North Carolina legislature authorized the creation of a North Carolina Stamping Office, making it the 15th Stamping Office in the nation.