Excess Line Broker licenses are available to New York residents licensed as brokers in New York and also to nonresidents from reciprocal states who are 1) licensed as excess or surplus lines brokers in their home states, and 2) who have or will obtain New York nonresident broker licenses. New York treats all states as reciprocal for these purposes except California, Florida, Montana, Washington and Washington DC. Residents of these states and Washington DC can obtain a nonresident excess line license but are limited to producing purchasing group business under the federal Risk Retention Act, except for California. California surplus line brokers can obtain full nonresident excess line licenses, but they are required to provide a bond to the New York State Insurance Department as an additional requirement.
GENERAL LICENSING INFORMATION
Excess line licenses are issued pursuant to New York Insurance Law §2105. Broker licenses are issued pursuant to §2104.
I. All licenses to entities (corporation, LLC’s and partnerships) expire on a common date, being October 31st of every even year.
II. All licenses issued to individuals, which go into effect on or after January 1, 2007, will expire on the individual’s birthday. Licenses will expire in even years for those born in even years and in odd years for those born in odd years. There will be a transition period to implement the changes to the licensing effective/expiration dates. During the transition, the Department will look to the year of your birth (odd or even year) and issue a license for no less than a two-year period. For example, an individual born January 30, 1956, who applies for a license on February 2, 2007, will be issued a license from February 2007 until January 30, 2010. Thereafter, the license will run to two-year intervals birthday to birthday.
III. The license application fee is generally $400 for the two-year period. If there is less than a full year left in the licensing cycle when you apply for the license, the fee is reduced to $200 generally.
IV. New York licenses entities, corporations, partnerships or limited liability companies if you operate your business as an entity. If so, one or more individuals become sublicensees of the entity, which employs the sublicensee. If you operate as a sole proprietorship, where you personally receive the commissions on placements and hold the premium trust account in your own name, only then is being licensed exclusively as an individual appropriate.
V. New York resident brokers must obtain 15 continuing education credits per licensing cycle to renew their broker licenses. Nonresident licensees must meet their home state requirements for continuing education.
VI. License Applications: The New York State Insurance Department (NYSID) has implemented an online renewal application system. Initial applications for licensure can be obtained from the Insurance Department’s website at http://dfs.ny.gov/index.htm , or by contacting the Albany office of the Insurance Department at 518-474-6630 – Automated Licensing Forms Request Line.
VII. New York requires each separate office location from which a broker/excess line broker operates to have at least one licensee or sublicensee to work out of that office and supervise its staff. See New York Insurance Law §2129 and Regulation 125 for additional detail.
VIII. All excess line brokers must file a year end tax report by March 15 of the following year, even if the licensee placed no excess line insurance in that year. Penalties apply to those that fail to file. ELANY provides reports in early March to each licensee who placed excess line business in the immediate preceding year. The reports assist licensees in preparing the excess line tax return provided the excess line broker filed transactions timely and accurately with ELANY.
This is not intended to be nor should it be construed as legal advice. Consult with your own legal counsel.
Last updated: October 2, 2020