A. No person shall export insurance on behalf of an insured whose home state is New Mexico except as authorized by and in accordance with Chapter 59A, Article 14 NMSA 1978.
B. No surplus lines broker shall transact surplus lines insurance with an insurer other than an eligible surplus lines insurer.
C. To qualify as an eligible surplus lines insurer, a nonadmitted insurer shall file information demonstrating to the superintendent's satisfaction that:
(1) the insurer is authorized to write the particular line of business in the state in which it is domiciled and:
(a) the insurer has capital and surplus or their equivalent that equals the greater of: 1) fifteen million dollars ($15,000,000); or 2) the minimum capital and surplus required in this state for that particular line of business; or
(b) the insurer has capital and surplus less than the amounts required in Subparagraph (a) of this paragraph but the superintendent affirmatively finds that the insurer is acceptable as an eligible surplus lines insurer. The finding shall be based upon such factors as quality of management, capital and surplus of any parent company, company underwriting profit and investment income trends and company record and reputation within the industry. In no event shall the superintendent make an affirmative finding of acceptability when the surplus lines insurer's capital and surplus is less than four million five hundred thousand dollars ($4,500,000);
(2) the insurer is a member of an "insurance exchange", which is an association of syndicates or insurers created by the laws of individual states, and shall maintain capital and surplus, or the equivalent thereof, of not less than fifty million dollars ($50,000,000) in the aggregate. For insurance exchanges that maintain funds for the protection of all insurance exchange policyholders, each individual syndicate shall maintain minimum capital and surplus, or the equivalent thereof, of not less than five million dollars ($5,000,000). In the event the insurance exchange does not maintain funds for the protection of all insurance exchange policyholders, each individual syndicate shall meet the minimum capital and surplus requirements of Subparagraph (a) of Paragraph (1) of this subsection;
(3) if the insurer is an alien insurer, the insurer is listed on the quarterly listing of alien insurers maintained by the international insurers department of the association; or
(4) if, pursuant to law, New Mexico has joined a compact or multistate agreement for the regulation of surplus lines insurance and the state, through the compact commission, has adopted nationwide uniform eligibility requirements, the insurer is in compliance with those requirements.
D. The superintendent shall maintain a list of eligible surplus line insurers from those qualified nonadmitted insurers that file information to satisfy the criteria established under Subsection C of this section. In addition to the requirements of Subsection C of this section, in order to appear on the list of eligible surplus lines insurers, a nonadmitted insurer shall provide annually to the superintendent a copy of the insurer's most current annual statement certified and sworn to by the insurer, unless the annual statement is available to the superintendent through the national association of insurance commissioners or from public sources. The statement shall be provided or made available at the same time it is provided to the insurer's domicile, but in no event more than nine months after the close of the period reported upon, and shall be either:
(1) filed with and approved by the regulatory authority in the insurer's domicile; or
(2) certified as correct and in accordance with applicable accounting principles by a public accounting firm licensed in the insurer's domicile.
In the case of an insurance exchange, the statement may be an aggregate combined statement of all underwriting syndicates operating during the period reported.
E. The listing described by Subsection D of this section shall not be deemed to constitute or evidence the superintendent's guaranty as to the financial condition or business practices of the insurer, and no insurer or other person shall allege orally or in writing that any such listing constitutes or implies the superintendent's approval.
F. The superintendent may adopt rules fixing reasonable conditions to be met by insurers for the listing. For good cause shown, the superintendent may in writing waive the requirements of this section to permit insurance to be placed as to a particular risk and insurer if the insurance is not otherwise reasonably obtainable.
History: 1978 Comp., § 59A-14-4, enacted by Laws 1991, ch. 125, § 14; 1994, ch. 13, § 2; 2011, ch. 156, § 7; 2017, ch. 130, § 8.
ANNOTATIONSRepeals and reenactments. — Laws 1991, ch. 125, § 14 repealed former 59A-14-4 NMSA 1978, as enacted by Laws 1984, ch. 127, § 242, relating to solvency, eligibility of brokers, and enacted a new section, effective April 3, 1991.
The 2017 amendment, effective July 1, 2017, clarified language in the section; in Subsection C, Paragraph C(4), after "compact", added "or multistate agreement"; in Subsection D, in the introductory language, after "a list of", added "eligible surplus line insurers from those qualified", after "nonadmitted insurers that", deleted "qualify as an eligible surplus lines insurer under this section" and added "file information to satisfy the criteria established under Subsection C of this section", after "nonadmitted insurer shall provide", added "annually", after "a copy of", deleted "its" and added "the insurer's", after "sworn to by the insurer", added "unless the annual statement is available to the superintendent through the national association of insurance commissioners or from public sources", and after "shall be provided", added "or made available"; and in Subsection E, after "The listing", deleted "required" and added "described", and after "evidence the superintendent's", deleted "approval or".
The 2011 amendment, effective June 17, 2011, limited the placement of insurance in nonadmitted insurers for insureds whose home state is New Mexico; required that nonadmitted insurers be authorized to write the line of business in their domiciliary state and that the insurer have capital and surplus equal to the greater of fifteen million dollars or the minimum amount required by New Mexico; eliminated the requirements that alien insurers and Lloyds plans maintain trust funds in the United States; required alien insurers be listed by the international insurers department and required the insurer to comply with nationwide uniform eligibility requirements adopted by New Mexico; and required the superintendent to maintain a list of qualified nonadmitted insurers.
The 1994 amendment, effective February 15, 1994, in Subsection E, substituted "groups that include incorporated and individual unincorporated insurers" for "unincorporated group of individual insurers" near the beginning and added the proviso clause at the end; and substituted "shall" for "must" in the first sentence of the introductory paragraph in Subsection G.