Compendium of State

Laws on Insurance

Topics – Individual Chart

Chart # TX-53

Surplus Lines Premium Tax

Allocation By State

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NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-1

5/10 The date following each state indicates the last time information for the state was reviewed/changed.

STATE STATUTE ALLOCATION DESCRIPTION AL (2/10)

§ 27-4A-3 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

AK (2/10)

§ 21.34.180 Yes In determining the amount of premiums taxable in this state, all premiums written, procured or received in this state shall be considered written on property or a subject located or resident in this state, except premiums that are properly allocated or apportioned and reported as taxable premiums of another state. In determining the amount of gross premiums taxable in this state covering a subject resident, located, or to be performed both inside and outside the state, the tax due shall be computed on that portion of the policy premium that is attributable to the subject resident, located or to be performed in this state and that relates to the kind of insurance being placed.

AZ (2/10)

§ 20-416 Yes The total premium charged for surplus lines insurance placed in a single transaction with one or more policies will be allocated to this state in the proportion that the insured properties or operations in this state bears to the total premium.

AR (2/10)

§ 23-65-315 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

CA (2/10)

Ins. § 1775.5 Yes The total premium charged for surplus lines insurance placed in a single transaction with one or more policies will be allocated to this state in the proportion as the total premium on the insured properties or operations in this state.

CO (2/10)

§ 10-5-111 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

CT (2/10)

§ 38a-743 No No mention of premium tax allocation.

NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-2

5/10

STATE STATUTE ALLOCATION DESCRIPTION DE (2/10)

tit. 18 § 1917 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

DC (2/10)

§ 31-2502.40 No No provision

FL (2/10)

§ 626.932 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

GA (2/10)

§ 33-5-31 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

HI (2/10)

§ 431: 8-315 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

ID (2/10)

§ 41-1229 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

IL (2/10)

215 ILCS 5/445 No No mention of premium tax allocation.

IN (2/10)

§ 27-1-15.8-4 No No mention of premium tax allocation.

IA (2/10)

§ 432.1 Probably implied Statutes require premiums on property situated in this state.

KS (2/10)

§ 40-246c Yes Any individual placing a policy with an insurer not authorized to do business in this state on a risk domiciled in a state other than this state, but also covering a risk or location in Kansas, shall pay to the commissioner a sum equal to the portion of the premium applicable to the risk located in Kansas.

NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-3

5/10

STATE STATUTE ALLOCATION DESCRIPTION KY (2/10)

§ 304.10-180 Yes If the policy covers risks or exposures only partly in the state, the tax payable shall be computed on the portions of the premium that are properly allocable to the risks or exposures located in the state.

LA (2/10)

§ 22:439 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax so payable shall be computed upon the proportion of the premium which is properly allocable to the risks or exposures located in this state.

ME (2/10)

tit. 24-A § 2016 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed on the proportion of the premium that is properly allocable to the risks or exposures located in this state.

MD (2/10)

Ins. § 3-324 Yes If a surplus line policy covers risks only partly in the state, the tax payable shall be computed on the part of the premium that is properly allocable to the risks located in the state.

MA (2/10)

175 § 168 No No mention of premium tax allocation.

MI (2/10)

§ 500.1905 No No mention of premium tax allocation.

MN (2/10)

§ 297I.05 Yes If surplus lines insurance covers a subject residing partially outside the state, the entire premium must be allocated according to the risks, residing, located or to be performed in the state.

MS (2/10)

§ 83-21-25 No No mention of premium tax allocation.

MO (2/10)

§ 384.061 Yes If a surplus lines policy covers risks only partially located in this state, the tax payable shall be computed on the portions of the premium properly allocable to that portion of the risks located in this state and no Missouri tax shall be charged for that portion of risk that is located outside of the state of Missouri.

MT (2/10)

§ 33-2-311 Yes If a surplus lines insurance policy covers risks or exposures only partially in this state, the tax payable must be computed upon the proportion of the premium that is properly allocable to the risks or exposures located in this state.

NE (2/10)

§ 44-5506 No No mention of premium tax allocation.

NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-4

5/10

STATE STATUTE ALLOCATION DESCRIPTION NV (2/10)

§ 685A.180 Yes If a contract for surplus lines insurance covers risks or exposures only partially in this state, the tax so payable must be computed on that portion of the premium properly allocable to the risks or exposures located in this state.

NH (2/10)

§ 405:29 No No mention of premium tax allocation.

NJ (2/10)

§ 17:22-6.59 Yes If a contract for surplus lines insurance covers risks or exposures only partially in this state, the tax so payable must be computed on that portion of the premium properly allocable to the risks or exposures located in this state.

NM (2/10)

§ 59A-14-12 Yes If a contract for surplus lines insurance covers risks or exposures only partially in this state, the tax so payable must be computed on that portion of the premium properly allocable to the risks or exposures located in this state.

NY (2/10)

Ins. Law § 9102 Yes In determining the amount of direct premiums taxable in this state, all such premiums written, procured, or received in this state shall be deemed written on property or risks located or resident in this state except such premiums properly allocated and reported as taxable premiums of any other state or states.

NC (2/10)

§ 58-21-85 No No mention of premium tax allocation.

ND (2/10)

§ 26.1-44-06 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax must be computed upon the portion of the premium that is properly allocable to the risks or exposures located in this state.

OH (2/10)

§ 3905.36 No No mention of premium tax allocation.

OK (2/10)

tit. 36 § 1115 Yes The total premium charged for surplus lines insurance placed in a single transaction with one underwriter or group of underwriters, shall be allocated to this state in such proportion as the total premium on the insured properties or operations in this state.

OR (2/10)

§ 735.470 Reg. 836-071-0500

Yes The director by rule shall establish procedures for payment of taxes on the Oregon portion of risks covered by surplus lines insurance policies transacted outside this state that cover risks with exposures both in this state and outside this state. Disclose Oregon portion and pay appropriate tax.

NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-5

5/10

STATE STATUTE ALLOCATION DESCRIPTION PA (2/10)

Tit. 40 § 991.1621 Yes In the event that a placement of insurance involves subjects of insurance resident, located or to be performed in one or more states other than this Commonwealth, then the premium taxes provided for in this section shall be levied only on that portion of the premium reasonably ascribable to that portion of the risk situated in this Commonwealth.

PR (2/10)

tit. 26 § 1013 No No mention of premium tax allocation.

RI (2/10)

§§ 27-3-38 to 27-3-38.1 Probably implied Statutes require premium tax on property situated in this state.

SC (2/10)

§ 38-45-30 No No mention of premium tax allocation.

SD (2/10)

§ 58-32-45 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable will be computed upon the proportion of the premium that is properly allocable to the risks or exposures located in this state.

TN (2/10)

§ 56-14-113 Yes If a surplus lines policy covers risks or exposures only partially in this state, the tax payable shall be computed on the portions of the premium that are properly allocable to the risks or exposures located in this state.

TX (2/10)

Ins. Code § 225.004 Yes If a surplus lines policy covers risks or exposures only partially in this state, the tax payable shall be computed on the portions of the premium that are properly allocable to the risks or exposures located in this state.

UT (2/10)

§ 31A-3-303 Yes, if actually paid to other state.

If a policy covers risks that are only partially located in this state, for computation of tax under this part, the premium shall be reasonably allocated among the states on the basis of risk locations. However, all premiums with respect to surplus lines insurance received in this state by a surplus lines producer or charged on policies written or negotiated in or from this state are taxable in full under this part, subject to a credit for any tax actually paid in another state to the extent of a reasonable allocation on the basis of risk locations.

VT (2/10)

tit. 8 § 5036 Yes If any such insurance also covers a subject located or to be performed outside this state, a proper pro rata portion of the entire premium shall be allocated to the subjects of insurance located or to be performed in this state.

NAIC’s Compendium of State Laws on Insurance Topics

SURPLUS LINES PREMIUM TAX ALLOCATION BY STATE

© 2010 National Association of Insurance Commissioners III-TX-53-6

5/10

STATE STATUTE ALLOCATION DESCRIPTION VI (2/10)

Tit. 22 § 662 Yes If a surplus line policy covers risks or exposures only partially in this territory the tax so payable shall be computed upon the proportion of the premium that is properly allocable to the risks or exposures located in this territory.

VA (2/10)

§ 38.2-4809 No No mention of premium tax allocation.

WA (2/10)

§ 48.15.120 Yes If a surplus line policy covers risks or exposures only partially in this state the tax so payable shall be computed upon the proportion of the premium which is properly allocable to the risks or exposures located in this state.

WV (2/10)

§ 33-3-14 No No mention of premium tax allocation.

WI (2/10)

§ 618.43 Yes, if actually paid to the other state.

If a policy covers risks that are only partially located in this state, the premium shall be reasonably allocated among the states on the basis of risk locations in computing the tax, except that all premiums received in this state or charged on policies written or negotiated in this state shall be taxable in full under this section, with a credit for any tax actually paid in another state to the extent of a reasonable allocation on the basis of risk locations.

WY (2/10)

§ 26-11-118 Yes If a surplus line policy covers risks or exposures only partially in this state, the tax payable shall be computed upon the proportion of the premium that is properly allocable to the risks or exposure located in this state.

This chart does not constitute a formal legal opinion by the NAIC staff on the provisions of state law and should not be relied upon as such. Every effort has been made to provide correct and accurate summaries to assist the reader in targeting useful information. For further details, the statutes and regulations cited should be consulted. The NAIC attempts to provide current information; however, readers should consult state law for additional adoptions.

TX- 5 3

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