- Arkansas does maintain a list of eligible surplus lines insurers (see Other Comments section #1).
- Arkansas does have a Surplus Lines Association.
- Arkansas does not have an Export List.
- Arkansas has an industrial insured exemption for captive insurers only (see Appendix C) but otherwise follows the NRRA definition of exempt commercial policyholder (see Appendix C).
- Surplus lines tax: 4% payable by broker 60 days following the calendar quarter that the business was transacted.
- Arkansas has not affiliated with any existing compact but may enter into an agreement (HB 2143).
- Arkansas does allow domestic surplus lines insurers in the state (see Other Comments section #3).
Eligibility and Filing Requirements (Alien Insurers Only):
None, if company is on IID List (§23-65-310(a)).
Eligibility and Filing Requirements (Foreign Insurers Only):
- Notice of Intent Letter which includes the attached documentation:
a. Certificate of Compliance from the surplus lines insurer’s state of domicile.
b. Copy of most recent financial statement filed with its state of domicile.
c. Uniform Consent to Service of Process Form (UCAA Form 12) – surplus lines insurers do not have to appoint a resident agent, but provide the full name and address where a service of process is to be forwarded on Exhibit B of the form.
- Insurer must be authorized to write in its domiciliary jurisdiction, and
- Have Capital and Surplus or its equivalent under the laws of its domiciliary jurisdiction, which equals the greater of the minimum capital and surplus requirement under the law of its home state, or $15,000,000.
- Foreign Surplus Lines insurers no longer have to file any financial statement filings, renewal fees or state specific filings with our state since the Nonadmitted and Reinsurance Reform Act of 2010 (NRRA).If you have any questions please call, or visit this webpage:
Types of Insurance Exempted from Surplus Lines Regulation:
- Wet marine and foreign trade insurance.
- Insurance on subjects located, resident, or to be performed wholly outside Arkansas or on vehicles or aircraft owned and principally garaged outside Arkansas.
- Insurance on property or operation of railroads engaged in interstate commerce.
- Insurance of aircraft owned or operated by manufacturers of aircraft, or aircraft operated in scheduled interstate flight, or cargo of the aircraft, or against liability, other than workers’ compensation and employer’s liability, arising out of the ownership, maintenance, or use of the aircraft.
- Transactions subsequent to issuance of or relative to a policy covering only subjects of insurance not resident, located, or expressly to be performed in Arkansas at time of issuance, or covering property in course of transportation by land, air, or water to, from, or through Arkansas and including any preparation or storage incidental thereto, and lawfully solicited, written or delivered outside Arkansas.
Other Comments or Requirements:
- Link to all eligible surplus lines insurers via the company search database at:
- Arkansas requires each approved surplus lines carrier in the state, upon written request, to mail or deliver the policyholder’s claim information to the policyholder or his or her surplus lines broker within 30 days from the date of receipt of the request from the policyholder. This legislation also makes clear that surplus lines carriers are not required to file policy forms.
- Arkansas has a process whereby a domestic insurer possessing policyholders’ surplus of at least $20 million may be designated as a “domestic surplus lines insurer” with the written approval of the Arkansas Insurance Commissioner and be allowed to write surplus lines insurance in any jurisdiction in which it is eligible. A “domestic surplus lines insurer” is subject to the 4% surplus lines tax and would be deemed to be a non-admitted surplus lines insurer in the state of Arkansas. It is also deemed to be a non-admitted surplus lines insurer under the Dodd-Frank Act. A domestic surplus lines insurer is not subject to the Arkansas Property and Casualty Insurance Guaranty Act, or the Arkansas Life and Health Insurance Guaranty Association Act. All provisions of the Arkansas Insurance Code regarding financial and solvency requirements apply to a domestic surplus lines insurer unless it is otherwise specifically exempted
- Every insurance contract procured and delivered as surplus lines coverage must be initiated by or bear the name of the surplus lines broker who procured it and must contain a conspicuous statement substantially similar to the following:
“This contract is registered and delivered as a surplus line coverage under the Surplus Lines Insurance Law, and it may in some respects be different from contracts issued by insurers in the admitted markets, and, accordingly, it may, depending upon the circumstances, be more or less favorable to an insured than a contract from an admitted carrier might be. The protection of the Arkansas Property and Casualty Guaranty Act does not apply to this contract. A tax of four percent (4%) is required to be collected from the insured on all surplus lines premiums.”
- In 2014, the Arkansas DOI issued a clarifying Bulletin regarding the eligibility of Lloyd’s syndicates in Arkansas. The Bulletin states that any and all Lloyd’s syndicates appearing on the NAIC’s Quarterly Listing of Alien Insurers are eligible insurers in Arkansas per state statute and in accordance with the NRRA.
- The Arkansas DOI issued Bulletin #14-2015 in 2015 which clarifies that “inspection fees” may be included as an “expense of underwriting” and, in relation, are not subject to the 20% aggregate fee limit associated with solicitation negotiation or servicing expenses. However, the DOI further ruled that fees customarily associated with the solicitation, negotiation, or servicing of a surplus lines policy are subject to the 20% aggregate limit contained in Ark. Code Ann. 23-66-310(c)(2).
- On February 20, 2020, the Arkansas Department of Insurance (DOI) issued Bulletin No. 3A-2020 to remind surplus lines brokers to comply with Senate Bill 310. Effective July 24, 2019, Section 19 of S-310 amended AR ST s 23-65-315(a) to require surplus lines brokers to submit premium taxes to the State Treasurer through the DOI within 60 days following the end of the calendar quarter (instead of the end of the month as was currently required) in which surplus lines insurance was procured.According to the DOI, surplus lines brokers should comply with the following remittance deadlines for surplus lines premium taxes in 2020:
Quarterly Surplus Lines Coverage Procured Remittance Deadline First Quarter (ending March 31, 2020) June 1, 2020 Second Quarter (ending June 30, 2020) August 31, 2020 Third Quarter (ending September 30, 2020) November 30, 2020 Fourth Quarter (ending December 31, 2020) March 1, 2021
Surplus brokers are expected to use the OPTins to file and pay surplus lines premium taxes. Brokers may register to use the system by contacting the OPTins Marketing Team at 816-783-8787 or [email protected]. It takes 7-10 business days to set up a new account.