P&CIllinoishard
Before placing a risk with a non-admitted surplus lines insurer subject to the 3.5% tax under 215 ILCS 5/445, an Illinois surplus lines producer must generally do which of the following?
Conduct and document a diligent search of the admitted market establishing the coverage is unavailable from admitted insurers
BObtain prior approval of the rate from the IDOI Director
CFile the rate with NCCI for advisory review
DObtain a binding determination from the Illinois FAIR Plan that the risk is uninsurable
Why this is the answer
Under 215 ILCS 5/445, an Illinois surplus lines broker generally must conduct a diligent search of the admitted market and document that the coverage is not reasonably available from authorized Illinois insurers before placing the risk with an eligible non-admitted surplus lines insurer. The 3.5% surplus lines premium tax then applies. The Illinois Surplus Line Association assists with documentation and stamping.
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