Laws / Regs
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Surplus Lines Overview
Insurance companies licensed by the Pennsylvania Insurance Department (PID) write most of the insurance in Pennsylvania. The state regulates these licensed companies and policyholder claims will be covered by the Pennsylvania Property and Casualty Insurance Guaranty Association if a licensed insurance company becomes insolvent.
Licensed insurance companies do not provide all of the insurance needed by Pennsylvania companies or individuals. When insurance cannot be obtained from licensed insurers, it is considered “surplus lines insurance” and it may be obtained from unlicensed insurers that are on PID’s Eligible Surplus Lines Insurer List. Pennsylvania’s Surplus Lines Law includes the following.
- For policies with an effective date after June 30, 2011 and Pennsylvania is deemed the “home state”, all surplus lines placements must be filed with the Pennsylvania Surplus Lines Association (PSLA) based on 100% of the total premium.
- For policies with an effective date before July 1, 2011 and there is at least one location of risk within the Commonwealth of Pennsylvania the placement must be filed with PSLA using the allocated Pennsylvania premium and tax.
- For polices with an effective date after June 30, 2011 and another state is deemed the “home state”, please contact the "home state" for filing procedures.
- Per Section 1609(a), the insurance agency/agent (writing producer) must confirm that the insurance is not available from a Pennsylvania-licensed (“admitted”) company.
- Per Section 1608, the insured was expressly advised in writing prior to placement of the insurance that the insurer is not licensed and in the event of insolvency of the insurer, losses will not be paid by the Pennsylvania Property and Casualty Insurance Guaranty Association.
- Per Section 1604, the writing producer representing the insured must obtain the insurance coverage through a duly licensed surplus lines licensee.
Please refer to the following for more information.
- Pennsylvania Surplus Lines Law
- Pennsylvania Surplus Lines Code/Regulations
- PSLA Procedures and Electronic Filing User Manual
- Pennsylvania Surplus Lines Law Amendments and Act 14 of 2010
- Pennsylvania Surplus Lines Law Amendments - Act 28 and Act 29 of 2011