New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 1 - ADMINISTRATION › Subchapter 28 - FORMATION OF A DOMESTIC PROPERTY AND CASUALTY INSURANCE CORPORATION STOCK OR MUTUAL OR RECIPROCAL INSURANCE EXCHANGE › Section 11:1-28.4A - Designation as a domestic surplus lines insurer

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Pursuant to N.J.S.A. 17:22-6.6 9b, a domestic property and casualty insurer possessing policyholder surplus of at least $ 15,000,000 may, pursuant to a resolution of its board of directors, and upon approval by the Commissioner, be designated as a domestic surplus lines insurer. A domestic surplus lines insurer shall be considered an eligible, unauthorized insurer for purposes of writing surplus lines insurance coverage.
(b) A domestic surplus lines insurer shall only insure in this State a New Jersey risk procured from a surplus lines producer in accordance with the provisions of N.J.S.A. 17:22-6.4 0 et seq. This limitation with respect to New Jersey risks shall not be deemed to limit such insurer from transacting business as a surplus lines insurer in another state or jurisdiction pursuant to that state's or jurisdiction's requirements.
(c) A domestic surplus lines insurer shall not issue policies of private passenger automobile insurance, workers' compensation insurance, or workers' occupational disease insurance.
(d) Insurance written by a domestic surplus lines insurer shall be subject to a tax on premiums as provided by N.J.S.A. 17:22-6.5 9.
(e) A domestic insurer that is designated as a domestic surplus lines insurer shall only be approved to write the lines of surplus lines coverage that it is approved to write as a domestic insurer pursuant to its authority as a domestic insurer in this State, and may be considered as approved to write those lines by this State for purposes of seeking surplus lines eligibility in other states or jurisdictions.
(f) Whenever any insurance risk or any part thereof is placed with a domestic surplus lines insurer, the policy, binder, or cover note shall 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. 2011, c. 39 (C. 17:22-6.6 9b), 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. 17:22-6.7 1)."
(g) A foreign insurer that is currently admitted or eligible to transact business in this State that wishes to be designated as a domestic surplus lines insurer may seek to transfer its domicile to this State utilizing the procedures set forth in 17:17-20. An entity that will be a newly formed domestic insurer shall use the formation procedures set forth in N.J.A.C. 11:1-28. All information should be sent to: New Jersey Department of Banking and Insurance
Office of Solvency Regulation
Attn: Domestic Surplus Lines Insurance
20 West State St.
P.O. Box 325
Trenton, NJ 08625-0325