SURPLUS LINES FAQ - Delaware Insurance Commissioner
SURPLUS LINES FAQ - Delaware Insurance Commissioner
SURPLUS LINES FAQ - Delaware Insurance Commissioner
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If you do not have a policy number when you submit the SL-1905 – and you used a binder<br />
number – you will need to submit a SL-1908 Binder Number Replacement Form when you get<br />
the policy number. It must be printed and mailed to the Department.<br />
39. Does <strong>Delaware</strong> have a “White List”?<br />
The Department maintains the Eligible Surplus Lines Insurers listing – also referred to as the<br />
Bulletin # 5 listing – on its website. Each SL broker must restrict surplus lines business placed<br />
by him or her to the insurers on the listing.<br />
The status of eligibility, if granted by the <strong>Commissioner</strong>, only indicates that the insurer appears<br />
to be sound financially and to have satisfactory claims practices, and that the <strong>Commissioner</strong> has<br />
no credible evidence to the contrary. Placing a company on the list of eligible SL insurers does<br />
not require the <strong>Commissioner</strong> to determine the actual financial condition or claims practices of<br />
the unauthorized insurer.<br />
40. I am looking at the <strong>Delaware</strong> listing of Eligible Surplus Lines Insurers, but the company I’m<br />
looking for is not on the list. What are my options?<br />
Your only option is to place the risk with another carrier. <strong>Delaware</strong> law, §1907 (a), specifically<br />
states, “A broker shall not knowingly place surplus line insurance with an insurer that is unsound<br />
financially or that is ineligible under this section” [emphasis added]. The Department publishes<br />
a list of insurers deemed eligible to place surplus lines coverage, and all SL brokers are permitted<br />
to place business with listed eligible insurers only.<br />
41. I need to submit a filing on a policy that was placed with a carrier that is not on <strong>Delaware</strong>'s Eligible<br />
Surplus Line Insurers List – it is actually on the list of “Ineligible” Insurers. How should I handle this?<br />
The companies on the “Ineligible” Insurers list are <strong>Delaware</strong> domestic companies, meaning that<br />
they are incorporated in the state of <strong>Delaware</strong>. When a company is domiciled in DE, it is<br />
admitted in DE. <strong>Delaware</strong> domestic SL insurers cannot write business covering <strong>Delaware</strong> risks<br />
on a surplus lines basis.<br />
Surplus Lines Brokers should not be placing business with insurers that are not on the listing of<br />
Eligible Insurers that is published by the Department, but if it happens there are a couple of ways<br />
of handling the situation.<br />
If it is a multi-state surplus lines policy, the DE portion of the coverage must be placed with a<br />
different surplus lines company.<br />
If the entire risk is DE business, there are two possibilities and options:<br />
1. It may actually be admitted business – subject to rate & form filing requirements, etc. just<br />
like any other standard coverage<br />
2. If it is definitely surplus lines, it must be written with another surplus lines company.