Utah law requires that each surplus lines transaction in this state be examined to determine whether it complies with the surplus lines tax, solicitation and placement, and disclosure requirements of the law. The responsibility for this review has been delegated by the Insurance Commissioner to the Surplus Line Association of Utah through a contractual arrangement.
The surplus lines producer, having concluded that the risk appears to be proper for placement, makes a filing with the Association. This filing includes a copy of the policy and is accompanied by a submission form. If a copy of the policy is not available, a certificate, cover note, or other confirmation of insurance should be submitted within sixty (60) days of the date the policy was first effective.
The following statement must be affixed to all surplus lines policies: “The insurer issuing this policy does not hold a certificate of authority to do business in this state and thus is not fully subject to regulation by the Utah insurance commissioner. This policy receives no protection from any of the guaranty associations created under Chapter 28, Title 31A.”
Submissions will be examined to ascertain whether they comply with the Utah law, the Commissioner’s Rules, and the Association’s requirements. Unless the Association office notifies the surplus lines producer that the filing is incomplete, the placement then stands as being in compliance with the law for the term of the policy. Submissions which do not appear to be in compliance will be submitted in synopsis form to the Board of Directors. If it is the conclusion of the Directors that the placement is in violation, the surplus lines producer will be notified and told what action must be taken. If the producer wishes to appeal the Board’s decision, he/she is entitled to meet with the Board of Directors in order to discuss the matter further.