Who is accountable for ensuring compliance with surplus lines insurance regulations?

The surplus lines broker holds the responsibility for ensuring compliance with surplus lines insurance regulations. This role involves a thorough understanding of both state and federal laws concerning surplus lines insurance, which is typically essential because surplus lines involve risks that standard insurers may not cover. The broker acts as an intermediary between the insured and the insurance market, often navigating complex regulatory frameworks to ensure that all transactions comply with applicable laws.

While insurance companies are also subject to regulations within their operations and policyholders should be aware of the compliance landscape, it is primarily the responsibility of the surplus lines broker to guarantee that the required filings and fees are paid and that policies are placed according to state guidelines. The insurance department oversees the broader compliance mechanisms but relies on brokers to adhere to the specific guidelines for surplus coverage.