Share:
House Co-Sponsorship Memoranda
House of Representatives
Session of 2023 - 2024
Regular Session
MEMORANDUM
| Posted: | June 30, 2023 01:51 PM |
|---|---|
| From: | Representative Kevin J. Boyle and Rep. Tina Pickett |
| To: | All House members |
| Subject: | Ensuring access to surplus lines insurance |
| A recent Pennsylvania Supreme Court case has resulted in substantial unintended consequences for a small but critical segment of the Pennsylvania insurance market called surplus lines insurance. Surplus lines insurance covers consumers who are unable to obtain insurance in the "admitted marketplace" due to the risk. Current insurance law says that licensees can charge a fee in addition to commission for selling commercial insurance. In Woodford v. Insurance Department, the courts ruled that because the law is specific to commercial products, the statue should be interpreted to mean it prohibits the charging of fees for non-commercial (private) insurance products. The ruling established broad precedent that is impacting surplus lines brokers who had nothing to do with the underlying case. As a result, Pennsylvania is the only state in the country that does not allow surplus lines brokers to recoup their costs when seeking insurance not available on the admitted market and brokers will find it increasingly difficult to remain in business. My legislation would bring clarity and uniformity to the market by codifying a surplus lines fee structure for personal surplus lines transactions. This will facilitate availability of insurance products for hard-to-place risks. |
Introduced as HB1595