South Dakota is Sixth State to Join Nonadmitted Insurance Multi-State Agreement (NIMA)
Jul 15, 2011
The Florida Office of Insurance Regulation announced today, July 15, 2011, that South Dakota has become the sixth state to join the Nonadmitted Insurance Multi-State Agreement (“NIMA”)
NIMA will allow participating states to consolidate the collection, allocation and reporting of premium taxes for multi-state surplus lines insurance transactions pursuant to the Nonadmitted and Reinsurance Reform Act, part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
The OIR news release on this announcement is reprinted below.
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South Dakota Officially Becomes Sixth State to Join NIMA
TALLAHASSEE, Fla. – The Members States of the Non-Admitted Insurance Multi-State Agreement coalition are proud to welcome South Dakota to the NIMA group. Insurance Director Merle Scheiber signed on behalf of South Dakota, which collected nearly $29 million in excess and surplus lines premium in 2009. With the addition of South Dakota, NIMA states now represent 19.6% of the surplus lines market according to 2009 data.
NIMA is an agreement that provides a mechanism to report, collect, allocate and distribute surplus lines tax revenues consistent with the Non-Admitted and Reinsurance Reform Act (NRRA). The NRRA became part of the Dodd-Frank Wall Street Reform legislation passed in 2010 that allows only the home state to require premium tax payments for non-admitted insurance. Without this agreement, several states could potentially lose surplus lines tax revenues; the lack of an agreement could create distortions in the marketplace.
The participating states now include Florida, Mississippi, Hawaii, Connecticut, Louisiana and South Dakota. Several states have passed legislation and expressed interest in joining NIMA, but are prohibited from officially joining until the July 21, 2011 deadline established in the federal legislation. NIMA member states plan to wait until after the July 21 deadline to elect officers and select a clearinghouse to administer the funds. The State of Florida has agreed to temporarily house the NIMA website, which will contain the signature documents from member states.
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