AK vs HI -- Regulation in Alice's Example
Per the example in the wiki,
"Alice the Actuary's home state is Hawaii. ... Anyway, since Cold & Frozen is domiciled in AK, that means AK has exclusive authority to regulate them (since they are a surplus line). That includes licensing."
According to Page ii in Dearie, "the federal act states that no state, other than an insured's home state, may require a surplus lines broker to be licensed... with respect to such insured."
Is Alice not the "insured" in this case (and in that case, would the licensing be done by HI)?
If Alice is the "insured," does the surplus lines insurer have to be licensed in every state in which it has insureds? How would that prevent compliance with multiple states?
Comments
I just reread that example with HI and AK, and I'm not sure now what I was thinking when I wrote the last sentence. I struck it out and inserted a different sentence that refers to HI as being the state that would licence the broker since Alice is in HI, as you said above. Thank you for pointing that out.
Regarding the licensing of the surplus lines insurer: The way I read the provision for "uniform eligibility requirements" was if the surplus lines insurer was licensed in any state, it automatically fulfilled the licensing/eligibility requirements of every state. That was built into the NRRA.
And it might just be me that at first I thought 1-state compliance might contradict uniform eligibility standards, but after I read the text more carefully, I realized those provisions apply to different concepts. The 1-state compliance refers only to broker licensing whereas uniform eligibility standards refers to licensing of the insurer. So no contradiction.
Thx.
Thanks for your help and for the changes to the wiki! It makes a lot more sense now what the benefit is!