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Committee approves bill to codify surplus-lines broker fee practice, exempting brokers from 20% cap
Summary
Senate Bill 76 was approved by the Senate Insurance & Commerce Committee to put into statute an exemption that allows surplus-lines brokers to charge fees beyond the 20% cap applied to agents, sponsors said this preserves access to coverage for hard-to-place risks.
The Senate Insurance & Commerce Committee approved Senate Bill 76 to place into Arkansas law an existing practice by the Arkansas Insurance Department that surplus-lines brokers are exempt from a 20% fee cap applied to agents.
Senator Johnson presented the bill, saying it "does not change existing public policy since 02/2015" but moves the Department's interpretation into statute. He said surplus-lines brokers face different costs than admitted-market insurers and often must charge separate fees to cover underwriting, inspection and placement costs. "For that reason, surplus lines brokers frequently charge fees in order…
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