Surplus Line Broker Requirements - (Individuals)
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Definition
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| An individual, corporation, partnership or other
business entity required to be licensed under the laws of this state to procure
certain insurance coverages, called surplus lines, that cannot be procured from
authorized insurers. |
Qualifications
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Qualifications necessary in order to become a
surplus line broker include, but are not limited to:
Resident: Any person who is licensed as a resident producer for
the property and casualty lines of authority, and who is deemed to have had
sufficient experience in the insurance business may be licensed as a surplus
line broker. Regulation 36 requires a high school diploma and 3 years of recent
full-time experience in the property and casualty field.
Non-Resident: Any person who is licensed in their home state as a
surplus line broker may be licensed in Alabama as a surplus line broker if the
applicant's home state awards non-resident licenses to residents of this state
on the same basis.
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Initial Licensing Process
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Application form AL-SLB-1 and bond form AL-SLB-13 must be completed and
accompanied with a fee of $220.00. (an application fee of $20.00 and a
licensing fee of $200.00)
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Alabama residents must execute and attach a bond in the amount of $50,000.
(Form AL-SLB-13)
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Application and $220.00 fee (and bond if applicable) should be sent to:
Alabama
Department of Insurance
P O Box 830704
Birmingham, AL 35283-0704
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Suspension or Revocation
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| A surplus line broker's license may be revoked
if the broker fails to file their annual statement, remit the annual tax
required by law, maintain the appropriate bond, keep records of transactions
under the license, or allow examination of licensee, or any cause for which a
producer license may be revoked. The Commissioner may suspend or revoke the
surplus line broker's license if he finds that the broker has, willfully or
without exercise of due care, placed any insurance coverage with an
unauthorized (non-admitted) insurer in violation of any of the Alabama code
requirements. |
Requirements
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If certain insurance coverage cannot be procured on terms acceptable to the
insureds from authorized insurers, such coverages, designated "surplus lines",
may be procured from unauthorized insurers.
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The insurance must be procured through a licensed surplus line broker.
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The full amount of insurance required must not be procurable, after diligent
effort, from among the insurers authorized to transact that kind and class of
insurance.
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The insurance must not be procured for the purpose of securing the advantage of
a lower premium rate than would be accepted by authorized insurers.
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Within 30 days of the effective date of the insurance policy, the surplus line
broker shall file a written report (Form ID-12) validating that coverage was
written through the unauthorized market.
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Forms
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Surplus Line Broker Renewal Process
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| Surplus Line Broker licenses are continuous
subject to payment of a $200.00 annual renewal fee. No continuing education is
required for license renewal. Renewed surplus line brokers can be verified on
our web site at www.aldoi.gov. Renewal
licenses are mailed within 5-10 business days from date of receipt of fees. |
FOR LICENSES PREVIOUSLY RENEWED OR NEWLY ISSUED
BEFORE OCTOBER 1:
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On or about October 1 of each year, a renewal form is sent to all surplus line
brokers subject to renewal.
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Renewal form and $200.00 renewal fee should be mailed by November 15 to allow
for processing.
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Surplus Line Broker licenses expire on December 31
if fees are not received by that date.
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If your license expires, you must submit a new
Form AL-SLB-1 (Application for Individual Surplus Line Broker License).
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Renewal form and fee should be mailed to:
Alabama Department of
Insurance
P O Box 830922
Birmingham, AL 35283-0922
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FOR LICENSES NEWLY ISSUED BETWEEN OCTOBER 1 AND
NOVEMBER 30:
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On or about December 1 of each year, a renewal form is sent to all surplus line
brokers subject to renewal.
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Renewal form and $200.00 renewal fee must be received by December 31.
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Surplus Line Broker licenses expire on December 31
if fees are not received by that date.
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If your license expires, you must submit a new
Form AL-SLB-1 (Application for Individual Surplus Line Broker License).
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Renewal form and fee should be mailed to:
Alabama Department of
Insurance
P O Box 830922
Birmingham, AL 35283-0922
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