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Authority: AS 21.03.010

AS 21.06.090

Editor's note: As of Register 124 (January 1993) the regulations attorney corrected the parenthetical citation to the Liability Risk Retention Act of 1986 to the Liability Risk Retention Act.

In 2010 the revisor of statutes, acting under AS 01.05.031 , renumbered former AS 21.90.900 as AS 21.97.900 . As of Register 196 (January 2011), the regulations attorney made conforming technical revision under AS 44.62.125 (b)(6), to 3 AAC 24.590, so that cross-references to former AS 21.90.900 now refer to the renumbered statute, AS 21.97.900 .

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Chapter 25
Surplus Lines - Unauthorized Insurers

Section

10. Conditions for procurement of surplus lines coverage.

20. Prohibited procurement of surplus lines coverage.

30. (Repealed).

35. Documentation.

40. Surplus lines placement list.

50. Required notice of nonrenewal and premium increase.

60. Evidence of insurance.

70. Notice.

80. Taxes and filing fees.

90. Report of insurance transactions.

100. Quarterly report.

105. Amended quarterly reports.

110. (Repealed).

120. Risk retention groups.

130. Vessel tonnage.

140. Eligibility requirements for surplus lines insurers.

150. Publication of the list of eligible surplus lines insurers.

900. Definitions.

3 AAC 25.010. Conditions for procurement of surplus lines coverage

(a) Insurance may be procured through a surplus lines broker from an eligible nonadmitted insurer only if the producing broker

(1) determines through a diligent search that the particular policy terms or conditions that are material to the insured cannot be obtained from an insurer that is admitted to do business in this state;

(2) completes the search before the surplus lines broker binds the insurance contract; and

(3) provides documentation of the search to the surplus lines broker not later than 15 days after the binding of the insurance contract; the documentation must meet the requirements of 3 AAC 25.035.

(b) Insurance may be procured through a surplus lines broker from a nonadmitted insurer that does not appear on the current published eligible list under AS 21.34.050 or on the list described in AS 21.34.040 (c)(7) only if

(1) the producing broker complies with (a) of this section; and

(2) the surplus lines broker has documentation that

(A) the director has the nonadmitted insurer's current annual statement required by AS 21.34.040 (d); and

(B) the portion of the risk to be placed with the nonadmitted insurer cannot be obtained from a nonadmitted insurer that appears on the eligible list under AS 21.34.050 or on the list described in AS 21.34.040 (c)(7).

History: Eff. 8/28/91, Register 119; am 6/11/2006, Register 178; am 9/4/2014, Register 211

Authority: AS 21.06.090

AS 21.34.020

AS 21.34.040

AS 21.34.060

AS 21.34.250

3 AAC 25.020. Prohibited procurement of surplus lines coverage

(a) Workers' compensation insurance required by statute may be procured only from an insurer holding a valid certificate of authority to write workers' compensation insurance in this state.

(b) Upon written application by the insured to the director, stating the specific reasons, the director will, in the director's discretion, give written approval to a specific risk for an exception to (a) of this section if the director determines that an exception is in the best interest of the insured and is not detrimental to the public interest.

(c) This section does not apply to the coverages included on the surplus lines placement list under 3 AAC 25.040.

History: Eff. 8/28/91, Register 119

Authority: AS 21.06.090

AS 21.34.010

AS 21.34.020

AS 21.34.030

AS 21.34.250

3 AAC 25.030. Due diligence; documentation

Repealed.

History: Eff. 8/28/91, Register 119; am 10/21/92, Register 124; am 4/3/94, Register 129; repealed 6/11/2006, Register 178

3 AAC 25.035. Documentation

(a) A producing broker and the surplus lines broker shall retain in the insured's file an acceptable form of documentation to establish that the producing broker and the surplus lines broker have complied with AS 21.34.020 and 3 AAC 25.010(a) . An acceptable form of documentation required by this subsection includes

(1) documentation of declinations from admitted insurers;

(2) evidence that the full amount, kind, or class of insurance could not be obtained from admitted insurers;

(3) affirmation that the coverage is on the director's current surplus lines placement list under 3 AAC 25.040; or

(4) an exception from the director under AS 21.34.020 (a)(4).

(5) documentation that

(A) the broker procuring or placing the surplus lines insurance has disclosed to an exempt commercial purchaser that insurance may be available from the admitted market that may provide greater protection with more regulatory oversight; and

(B) the exempt commercial purchaser has requested in writing that the broker procure or place the insurance from a nonadmitted insurer.

(b) A declination from an insurer for a class of insurance may be cited for other insureds for no more than 180 days.

(c) To be an acceptable form of documentation under (a)(1) of this section, an oral declination must be documented in writing and include the name, business location, and phone number of the insurer, the name and position of the person contacted, the date of contact, and the reason for the declination.

(d) A producing broker shall include in the documentation required under (a) of this section a description of the kind of insurance that is adequate for the director to determine whether insurance coverage is available in the admitted market to cover the kind of insurance.

History: Eff. 6/11/2006, Register 178; am 9/4/2014, Register 211

Authority: AS 21.06.090

AS 21.27.350

AS 21.34.020

AS 21.34.060

AS 21.34.250

AS 21.36.195

Editor's note: As of Register 195 (October 2010), the regulations attorney made a technical revision under AS 44.62.125 (b)(6), to 3 AAC 25.035(a) .

3 AAC 25.040. Surplus lines placement list

(a) After a hearing held under AS 21.06.180 - 21.06.230, the director will issue an order that lists the kinds of insurance that may be placed with a nonadmitted insurer that appears on the eligible list published under AS 21.34.050 .

(b) The director will hold a hearing and issue an order at least once every 12 months.

(c) A person may request a hearing under AS 21.06.180 to add a kind of insurance to the list or to delete a kind of insurance from the list.

(d) Only those kinds of insurance for which insureds generally are unable to secure coverage from admitted insurers will be included on the surplus lines placement list.

History: Eff. 8/28/91, Register 119

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