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Pennsylvania Statutes Title 40 P.S. Insurance § 991.1616a. Surplus lines fees

Current as of January 01, 2025 | Updated by Findlaw Staff

(a) Notwithstanding section 674-A of the act of May 17, 1921 (P.L. 789, No. 285),  1 known as “The Insurance Department Act of 1921,” a surplus lines licensee may charge a service fee for the placement of a surplus lines insurance policy in addition to a commission received from a surplus lines insurer in accordance with the following requirements:

(1) For personal lines insurance policies, the service fee shall not exceed one hundred fifty ($150) dollars or four per centum (4%) of the policy premium, whichever is greater. The following apply:

(i) The commissioner may increase these amounts by transmitting notice of the increase to the Legislative Reference Bureau for publication in the next available issue of the Pennsylvania Bulletin. The increase shall become effective upon publication of the notice in the Pennsylvania Bulletin.

(ii) The service fee may be charged for each policy.

(2) The service fee shall be reasonable in relation to the cost of underwriting, issuing and processing the policy.

(3) In advance of placement of the policy, the surplus lines licensee shall make clear and conspicuous disclosure in writing of the following:

(i) The total amount of the service fee, if any.

(ii) The total amount of the inspection fee, if any.

(iii) The amount of premium tax due on the policy.

(iv) An itemization of the fee charged for each service.

(v) A disclosure of any compensation payable to the licensee from the entity completing the inspection and ownership interest of the licensee in the entity completing the inspection, but excluding ownership interest that is part of an investment portfolio of publicly traded stock.

(b) A surplus lines licensee may recoup from the prospective insured the actual cost of any inspection required for the placement of surplus lines insurance with a surplus lines insurer if:

(1) The inspection is required.

(2) The cost of the inspection is:

(i) actually incurred by the surplus lines licensee;

(ii) not retained by the surplus lines licensee; and

(iii) documented and verifiable.

1 40 P.S. § 310.74.
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Cite this article: FindLaw.com - Pennsylvania Statutes Title 40 P.S. Insurance § 991.1616a. Surplus lines fees - last updated January 01, 2025 | https://codes.findlaw.com/pa/title-40-ps-insurance/pa-st-sect-40-991-1616a/

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