- Louisiana maintains a list of eligible surplus lines insurers (see Other Comments section #1).
- Louisiana has a Surplus Lines Association for brokers only but does not have a Stamping Office.
- Louisiana does not have an Export List.
- Louisiana does have an industrial insured exemption with respect to workers’ compensation insurance only (see Appendix C) and also recognizes the exempt commercial purchaser exemption as of 7/21/2011, although it is not yet codified.
- Surplus lines tax: 4.85%, payable by producer. Producers are required to separately itemize the tax on the declaration page of the policy, LRS 22:855.
- Louisiana withdrew from NIMA in 2015.
- Louisiana does allow domestic surplus lines insurers in the state (see Other Comments section #10).
Eligibility and Filing Requirements (All Insurers):
- Examination Fee: $1,050 due March 1.
- Annual Statement/Report: due April 15.
- Premium report.
Eligibility and Filing Requirements (Alien Insurers Only):
- NAIC Reporting Format: due July 31.
- Statement of Total Premiums Written in Louisiana: due April 15.
- Trust Fund: Not less than the greater of $5,400,000 or 30% of the company’s U.S. surplus liabilities, excluding liabilities from exempt business, not to exceed $60,000,000 (see Other Comments section #4).
- Statement of Assets in Trust.
- Capital and Surplus: follows NAIC requirements (see Appendix E).
- NAIC Listing.
Eligibility and Filing Requirements (Foreign Insurers Only):
- Capital and Surplus: Equal to or greater than $15,000,000.
- Authorized to write in its home jurisdiction.
Types of Insurance Exempted from Surplus Lines Regulation:
- Insurance on property and operation of railroads or aircrafts engaged in interstate or foreign commerce.
- Insurance on vessels, crafts, 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 of policy (see Other Comments sections # 2 and #3).
- Transactions involving risks located in Louisiana where the policy or contract of insurance for such risk was principally negotiated and delivered outside Louisiana, and was lawfully issued in a state or foreign country in which the foreign or alien insurer was authorized to operate an insurance business, and where such insurer has no contact with Louisiana except in connection with inspections or losses required by virtue of the contract or policy of insurance covering the risk located in Louisiana, including transactions involving the operation of workers’ compensation claims offices.
Other Comments or Requirements:
- Louisiana eligibility list available at www.ldi.la.gov/onlineservices/WhiteList/.
- The definition of marine insurance does not involve vessels and watercraft under five tons of gross weight.
- Coverage for any wet marine risk arising out of the exploration, discovery, development, or production for any mineral, the maintenance, shutting in, or the plugging and abandoning of any oil or natural gas or other marine mine, may only be placed with an insurer appearing on the Louisiana Surplus Lines Eligibility List.
- Louisiana deems compliance with the IID Plan of Operation Standard form trust requirement to be in compliance with Louisiana Law.
- The Louisiana Surplus Lines Association webpage is www.LSLA.bizland.com
- The Louisiana Legislature enacted legislation in 2013 which authorizes the placement of surplus lines insurance without regard to the availability of coverage from authorized (admitted) insurers. The bill also clarifies that inclusion on the Louisiana list of unauthorized insurers shall be prima facie evidence that an unauthorized insurer meets the financial and eligibility criteria for surplus lines insurance.
- The following disclosures are required on the declaration pages of surplus lines policies: 1) the premium, tax, and any fees charged should be separately stated and itemized; and 2) every surplus lines contract in Louisiana must have stamped or printed upon it in red or, if not in red, offset by a black border and signed by the surplus lines broker who procured it, in bold type and in not less than ten-point type, the following:“NOTICE
This insurance policy is delivered as a surplus line coverage under the Insurance Code of the State of Louisiana.
In the event of insolvency of the company issuing this contract, the policyholder or claimant is not covered by the Louisiana Insurance Guaranty Association which guarantees only specific policies issued by an insurance company authorized to do business in Louisiana.
This surplus lines policy has been procured by the following licensed Louisiana surplus lines broker:____________________________________
Signature of Licensed Louisiana Surplus Lines Broker or Authorized Representative____________________________________
Printed Name of Licensed Louisiana Surplus Lines Broker”(Note: Louisiana DOI Bulletin No. 09-08 sets forth additional disclosures related to what is and what is not covered under various property policies with a focus on flood coverage. A link to Bulletin No. 09-08 may be found at https://ldi.la.gov/docs/default-source/documents/legaldocs/bulletins/bul09-08-cur-homeownersandfirecom.pdf
- The Louisiana Department of Insurance issued guidance in 2015 for calculating, reporting and paying surplus lines taxes as a consequence of the state’s withdrawal from the Nonadmitted Insurance Multistate Agreement (NIMA) and the reduction of the surplus lines tax rate from 5% to 4.85% pursuant to Act 386 (H.B. 259), Laws 2015 (both effective October 1, 2015). The guidance also provides notice of changes in Form 438 that are required by Act 193 (H.B. 214), Laws 2015. Any surplus lines policy with an effective date before October 1, 2015, will continue to be taxed at the 5% rate, and any endorsement, cancellation, change in coverage, or other premium transaction related to a policy that has an invoice date before October 1, 2015, and that causes an addition to or refund of tax or additional or return premium attributable to the policy will also be taxed or refunded at the 5% rate. For a single-state policy with an effective date before October 1, 2015, to obtain a refund for taxes paid at the 5% rate. It will be necessary for the broker to amend the surplus lines tax return for the quarter in which the tax was originally reported and paid.
- Effective July 1, 2015, two categories of purchasers are exempt from the tax on surplus lines insurance. The first category is “any college, university, school, institution, or program that is under the supervision or management of a system board of supervisors provided for in [La.] R.S. 17:3215 through 3217.1.” The boards referred to are those for Louisiana State University, Southern University, University of Louisiana, and the Louisiana Community and Technical College. The second category is any political subdivision “having a population of not less than three hundred fifty thousand persons according to the latest federal decennial census.” Any purchaser of insurance claiming the political subdivision exemption must provide legal authority to the surplus lines broker to substantiate the purchaser’s legal status as a political subdivision.
- Effective August 1, 2015, a new category of insurer – the domestic surplus lines insurer – was created. As a result, references to “approved unauthorized” and “eligible unauthorized” insurers are changed where appropriate to simply state “surplus lines insurers.”