Exemptions from SL Law
Paragraph 11 of the Surplus Line Law exempts certain transactions from the surplus line law. Exempt transactions are:
- Insurance of property and operations of railroads engaged in interstate or foreign commerce;
- Insurance of property and operations of aircraft engaged in interstate or foreign commerce;
- Any risk insured under an ocean marine or wet marine form of policy.
Since they are exempt, you do not need to submit these transactions to the SLAI or charge surplus line tax, fire marshal tax or stamping fee.
There is no exemption in the Illinois Surplus Line Law for nonprofits or governmental entities.
The Illinois Department of Insurance has notified us of their view that surplus line insurance sold to federally chartered credit unions is exempt from the Illinois surplus line law, and filing and tax required thereunder, by virtue of 12 USC §1768.