State SealARIZONA HOUSE OF REPRESENTATIVES

 

SB 1004: insurance; surplus lines; reports; payments

PRIME SPONSOR: Senator Livingston, LD 22

BILL STATUS: Commerce

                               

 

Overview

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal NoteAllows the electronic submittal of surplus lines reports and payments.

History

An insurance coverage or type that is not readily procurable from authorized insurers is recognized as surplus lines (A.R.S. § 20-409). Surplus lines insurance may be procured from an unauthorized insurer through a licensed surplus lines broker (A.R.S. § 20-407).

Pursuant to A.R.S. § 20-408, a surplus lines broker is required to file a report with the director (Director) of the Department of Insurance (ADOI) setting forth facts which verify: 1) that the surplus lines insurance procured from an unauthorized insurer is procured through a licensed surplus lines broker; and 2) the insurance coverage is a recognized surplus line and the placing of the insurance with an unauthorized insurer is not for the purpose of securing advantages either as to premium rate or terms of the insurance contract.

Provisions

1.       Modifies the contents of the surplus lines broker report to include the city, state and zip code of the insured, rather than the address. (Sec. 1)

2.       Permits the Director to require the electronic submission of certain reports and payments, beginning January 1, 2020.

a.       Instructs the Director to include a list of acceptable 3rd-party services on ADOI's website through which a surplus lines broker must submit such reports and payments. (Sec. 2)

3.       Allows, rather than requires, the Director to collect the tax by distraint and recover the civil penalty by an action against the insured and the surplus lines broker. (Sec. 3)

4.       Stipulates that a penalty does not accrue for any payment of tax or interest that is late due to delays caused by the 3rd-party service, if the tax is required to be paid electronically. (Sec. 3)

5.       Makes technical changes. (Sec. 1, 3)

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9.       Fifty-fourth Legislature                       SB 1004

10.   First Regular Session                            Version 1: Commerce

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