Taxes and Stamping Fees
In this chapter...
Introduction
Unless subject to
exemption, surplus line policies are assessed
surplus line tax, stamping fee and, in some cases,
fire marshal tax. These taxes and fees are levied
upon the surplus line producer who is permitted by
law to pass them on to the insured. If
the taxes and stamping fee are charged to the
insured, they must each be shown as separate line
items on the declarations page. Attaching
the EFS filing confirmation page is an acceptable
substitute for this requirement.
The surplus line tax imposed by the State of
Illinois is 3.5% of the policy premium, rounded to
the nearest whole dollar. It is assessed against
premium only. Do not include any broker fees,
inspection fees or other items when calculating the
tax – just what is shown as "premium" on the policy.
Taxes are paid to the State of Illinois and mailed
to the address shown on the tax statement. For
more tax form filing and tax payment
information, click
here.
Like the surplus line tax, the fire marshal tax is
rounded to the nearest whole dollar and is assessed
against premium only.
Taxes are paid to the State of Illinois and mailed
to the address shown on the tax statement.
Form more tax form filing and tax payment
information, click
here. The fire marshal tax imposed by the State of
Illinois is 1% of the fire premium, as defined
below.
|
Line of business |
Fire Marshal Tax is... * |
|
Fire (1) |
1% of |
100% of the premium |
| Allied Lines (1) |
1% of |
25% of the premium |
|
Crop Hail |
1% of |
1% of the premium |
|
Farmowners Multi-peril (2) |
1% of |
40% of the premium |
|
Homeowners Multi-peril (2) |
1% of |
40% of the premium |
|
Commercial Multi-peril (2) |
1% of |
40% of the premium |
| Multiple Line (2) |
1% of |
40% of the premium |
|
Inland Marine (3) |
1% of |
15% of the premium |
|
Earthquake |
1% of |
25% of the premium |
|
Auto Physical Damage |
1% of |
5% of the premium |
|
All Risk - Real Property |
1% of |
50% of the premium |
* Rounded to the nearest whole dollar
1. Fire premiums that include allied lines are assessed the full
100%. If the premiums are separate and distinct (fire and allied)
the allied lines portion may be assessed at 25%.
2. For policies covering
multiple perils, if the premium charged for each
peril is shown separately on the declarations page
or in the policy, compute the fire marshal tax on
the premium for each peril separately
using the chart above (with each one rounded to the
nearest dollar). If the premium for multiple line policies
is a combined premium, the fire marshal tax applies
to 40% of the premium as shown above.
3. Inland Marine, including personal property floaters and other
floater policies.
The Association stamping fee applies to each surplus line premium
processed through the Association at the rate shown on the table below.
Like taxes, the stamping fee is rounded to the
nearest whole dollar and is assessed against premium
only. Stamping fees are paid to the
Surplus Line Association of Illinois and mailed to
the address shown on the invoice. The
Association bills members on a monthly basis for business processed
the preceding month. The stamping fee is due and payable on or before
the last day of the following month. For example, documents processed in July
will be billed in August, usually between the 10th and the 15th, and the
stamping fees are due and payable by September 30th.
You are permitted by law to pass the stamping fee (as well as the surplus line
tax and fire marshal tax) on to the insured. If you pass these fees on to your
insureds, they should be shown as separate items on the declarations page of
the insurance contract. Attaching the EFS filing confirmation page is
an acceptable substitute for this requirement.
Return premiums, taxes and fees should be handled in exactly the same manner.
In the event your monthly Association stamping fee is a negative figure, it
will be credited to your account or will be returned by the Association upon
request.
The Association is required by law to inform the Illinois Department of
Insurance of any member who is 60 days delinquent in the payment of
stamping fees.
|
Policy Effective Date |
Stamping Fee Rate* |
|
07/01/2006 & Thereafter |
0.1% or (.001) |
|
01/01/1995 - 06/30/2006 |
0.3% or (.003) |
|
01/01/1988 - 12/31/1994 |
0.1% or (.001) |
|
08/01/1986 - 12/31/1987 |
0.2% or (.002) |
|
07/01/1985 - 07/31/1986 |
0.5% or (.005) |
|
Prior to 07/01/1985 |
No Stamping Fee Assessed |
* Rounded to the nearest whole dollar
The premium, Surplus Line Tax, Fire Marshal Tax and Association Stamping
Fee as calculated for each document shall be rounded to the nearest whole
dollar. Each calculation involving less than 50 cents shall be rounded
down to the next lowest whole dollar (less that 50 cents becomes zero) and
each item involving 50 cents or more shall be rounded up to the next
highest whole dollar.
The surplus line tax, fire marshal tax and stamping
fee are levied upon the surplus line producer.
The surplus line producer is never exempt from these taxes
or fees based on the nonprofit status or
governmental entity status of the insured.
The surplus line producer is permitted by law
(although not
required) to pass the tax along to the insured.
When processing a cancellation or return-premium endorsement,
the taxes and stamping fees are calculated in the exactly the
as they are for a policy or an additional-premium
endorsement. They are assessed against premium only and the
rounding rule apples.
|
