The act adds definitions to "The Missouri Surplus Lines Law" (Sections 384.011 to 384.071). The act adds the terms "exempt commercial purchaser", "home state", "nonadmitted insurance" and "qualified risk manager" to the definition section of the Missouri Surplus Lines Law. The definitions for such terms are consistent with the NRRA (15 USC 8206)(Section 384.015).

Under the terms of the act, surplus lines insurance may be placed by a surplus lines licensee if the insurer is authorized to write the type of insurance in its domiciliary jurisdiction (Section 384.017).

The act modifies the requirements and qualifications for nonadmitted insurers to furnish coverage. A surplus lines licensee shall not place coverage with a nonadmitted insurer unless the licensee determines that the nonadmitted insurer:

(1) Meets the capital and surplus requirements of Missouri or $15 million (the director may waive the financial requirements if the nonadmitted insurer's capital and surplus is at least $4.5 million and the director finds the insurer is acceptable); and

(2) Appears on the most recent list or eligible surplus lines insurers published by the director or appears on the most recent quarterly listing of alien insurers maintained by the NAIC.

Under the terms of the act, a surplus lines licensee seeking to place nonadmitted insurance in Missouri for an exempt commercial purchaser shall not be required to satisfy any requirement to make a due diligence search to determine whether the full amount or type of insurance by the exempt commercial purchaser can be obtained from nonadmitted insurers if:

(1) The surplus lines licensee placing the surplus lines insurance has disclosed to such exempt commercial purchaser that the insurance may or may not be available from the admitted market that may provide greater protection with more regulatory oversight; and

(2) The exempt commercial purchaser has subsequently requested in writing the surplus lines licensee to place such insurance from a nonadmitted insurer (Section 384.021).

This act modifies the licensing requirements for insurance producers in the surplus lines insurance market. Beginning on or before July 1, 2012, the director shall participate in the national insurer database of the NAIC for the licensure of surplus lines licensees and the renewal of such licensees. Under the act, a person selling nonadmitted insurance with respect to an insured shall be required to obtain or possess a current surplus lines insurance issued by the director only if this state is the insured's home state (Section 384.043).

Under this act, every insured or self-insurer whose home state is Missouri who procures surplus lines insurance, other than through a surplus lines broker, must file a report describing the names of the insureds, the subject of the insurance and other prescribed information (Section 384.051).

Under the terms of this act, only the home state of the insured will have the authority to tax and regulate the placement of such policies, regardless of where portions of the risk is located. The act imposes the current 5% tax on insureds and self-insurers whose home state is this state on the gross amount of the premium (current law is net amount) (Section 384.051). The 5% tax shall be levied upon and only upon the entire gross premium for nonadmitted or surplus lines insurance policies for which the home state of the insured is Missouri. The placement of nonadmitted insurance shall be subject to the statutory and regulatory requirements of Missouri law only if this state is the insured's home state. A surplus lines broker is required to be licensed as a surplus lines licensee under the provisions of this chapter only if this state is the insured's home state (Section 384.061).

This act is similar to SCS/SB 392 (2011).

This act contains an emergency clause.

STEPHEN WITTE