Raised Bill No. 6363 Summary

• Connecticut adopts the Surplus Lines Insurance Multistate Compliance Compact, effective July 1, 2011, to establish uniform regulation of nonadmitted (surplus lines) insurance across multiple states.

• Creates the Surplus Lines Insurance Multistate Compliance Compact Commission to establish mandatory rules for premium tax allocation, reporting requirements, and a Clearinghouse to process and distribute premium tax data among compacting states.

• Establishes that nonadmitted insurance of multistate risks shall be regulated exclusively by the insured's home state, eliminating duplicative state regulatory requirements while allowing each state to charge its own tax rate on allocated premiums.

• Requires surplus lines licensees and insureds to report Clearinghouse transaction data and pay premium taxes through standardized procedures, with the Commission developing uniform allocation formulas based on readily available data.

• The Compact becomes effective when two states enact it, but the Commission and Clearinghouse operations begin when ten states or states representing over 40% of surplus lines insurance premium volume join, with reporting obligations beginning the first January or July following the first anniversary of Commission activation.