PLIllinoishard
An Illinois P&C producer with no surplus line broker license refers a hard-to-place rural dwelling risk to a colleague who is properly surplus-line licensed. Which arrangement is permitted under Illinois law?
Only the IL surplus line broker may place the business; an unlicensed-for-surplus producer may share commission only if separately P&C licensed and not soliciting the placement
BThe unlicensed-for-surplus producer may bind directly so long as commission is split
CNo referral is allowed; the consumer must initiate contact with the surplus line broker independently
DA power-of-attorney from the consumer eliminates the surplus line broker license requirement
Why this is the answer
Under 215 ILCS 5/445 only a licensed Illinois surplus line broker may procure coverage from a non-admitted insurer. The referring P&C producer may share commission if separately licensed and if the referring producer did not solicit or negotiate the surplus placement. Direct binding by an unlicensed-for-surplus producer is prohibited; powers of attorney do not waive the licensing requirement.
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