OLR Bill Analysis
AN ACT AUTHORIZING NONADMITTED INSURERS TO OPEN AN OFFICE IN THIS STATE.
This bill explicitly specifies that the Unauthorized Insurers Act allows a nonadmitted insurer to open an office in Connecticut to transact surplus lines insurance.
EFFECTIVE DATE: October 1, 2015
A nonadmitted insurer (or unauthorized insurer) is an insurer that has not been granted a certificate of authority by the insurance commissioner to transact insurance business in Connecticut (CGS § 38a-1(11)(E)).
Unauthorized Insurers Act
The Unauthorized Insurers Act defines what it means to transact insurance business in the state and sets out penalties for unauthorized insurers who do so. It exempts from its provisions “the lawful transaction of surplus lines insurance,” thus allowing nonadmitted insurers to transact surplus lines insurance (CGS § 38a-271 et seq.).
Surplus Lines Insurance
Surplus lines insurance is property and casualty insurance coverage that is unavailable from Connecticut-licensed insurers (i.e., admitted insurers) and must therefore be purchased from a nonadmitted insurer. Surplus lines insurers register with the Insurance Department, but are not domiciled in the state. They work through licensed surplus lines brokers who must maintain an office here (CGS § 38a-794).
Insurance and Real Estate Committee