Surplus line brokers: surplus line advisory organization.

Existing law authorizes a surplus line broker to solicit and place insurance for a home state insured, as defined, with a nonadmitted insurer only if that insurance cannot be procured from an insurer admitted for the particular class or classes of insurance and that actually writes the particular type of insurance in this state, as long as certain requirements are met. Existing law authorizes the Insurance Commissioner, by order, to declare permissible for placement for a home state insured with a nonadmitted insurer, exempt from specified requirements except the filing of a confidential written report, any type of insurance coverage or risk for which the commissioner finds, after a public hearing, that there is not a reasonable or adequate market among admitted insurers. The commissioner or his or her designee are required to maintain an export list showing all those exempt coverages and risks. This bill, among other things, would authorize the commissioner to also declare exempt from the requirements for placement of insurance with a nonadmitted insurer the type of coverage that is for new, innovative products for which a reasonable or adequate market among admitted insurers has not had time to develop. The bill would authorize additions to the export list to be made after a hearing, as prescribed. Existing law authorizes a qualified surplus line advisory organization to perform specified duties delegated by the commissioner related to the surplus line market and nonadmitted insurers. All surplus line brokers licensed under the surplus line law are deemed to be members of the advisory organization. This bill would also include any member of the National Association of Registered Agents and Brokers licensed as a surplus line broker in his, her, or its home state of residence or business and paying the applicable state license fee as members of the surplus line advisory organization if certain conditions are met.