Colorado Surplus Lines Test Correct
100%
Not all surplus lines are subject to a diligent search. T/F - ANSWER False
Each policy renewal is subject to a new diligent search. T/F - ANSWER True
How often are surplus line producers required to submit an activity report? - ANSWER
Monthly, Due on 15th
Which surplus lines policies are required to contain the nonadmitted disclosure
statement? - ANSWER All, and some might require additional disclosures if they are
claims-made policies, automobile policies that do not provide statutory coverages and
policies that are written with insurers that may not be eligible in CO
Can producers charge fees? - ANSWER Only under specific situations, listed in
Regulation 1-2-9. Also contains an exemption for wholesale producers
If a risk has a home state of Colorado and exposures are located within the state, how
much of the surplus lines premium tax is payable to Colorado? - ANSWER 100%
(Colorado Home State Rules)
If a risk is home based in another state and there are no exposures in that state AND
the majority of the exposures are located in Colorado, how much of the tax is payable to
Colorado? - ANSWER 100% of the tax for all locations and exposures shall be reported
to Colorado and tax paid at the Colorado rate for all exposures. (Colorado Home State
Rules)
Broker fees that are associated with an insurance policy and appear on the policy are
subject to surplus lines tax. T/F - ANSWER True
Fees charged by a broker not associated with a policy of insurance and not appearing
on the policy face are not subject to surplus lines tax. T/F - ANSWER True
Colorado is a Broker Responsibility State. T/F - ANSWER True, with implementations to
Article V, Colorado complied with the federal requirements of the National Risk
Retention Association (NRRA) and subsequently became a broker responsibility state
Who has the responsibility of ensuring the financial stability and viability of the non-
admitted insurer? - ANSWER The Producer (Colorado Division of Insurance no longer
conducts a substantial financial review)
What should you do if you realize that you are late to report a policy from prior to 2017
but not before 2006? - ANSWER Contact the Colorado Division of Insurance (DOI) and
100%
Not all surplus lines are subject to a diligent search. T/F - ANSWER False
Each policy renewal is subject to a new diligent search. T/F - ANSWER True
How often are surplus line producers required to submit an activity report? - ANSWER
Monthly, Due on 15th
Which surplus lines policies are required to contain the nonadmitted disclosure
statement? - ANSWER All, and some might require additional disclosures if they are
claims-made policies, automobile policies that do not provide statutory coverages and
policies that are written with insurers that may not be eligible in CO
Can producers charge fees? - ANSWER Only under specific situations, listed in
Regulation 1-2-9. Also contains an exemption for wholesale producers
If a risk has a home state of Colorado and exposures are located within the state, how
much of the surplus lines premium tax is payable to Colorado? - ANSWER 100%
(Colorado Home State Rules)
If a risk is home based in another state and there are no exposures in that state AND
the majority of the exposures are located in Colorado, how much of the tax is payable to
Colorado? - ANSWER 100% of the tax for all locations and exposures shall be reported
to Colorado and tax paid at the Colorado rate for all exposures. (Colorado Home State
Rules)
Broker fees that are associated with an insurance policy and appear on the policy are
subject to surplus lines tax. T/F - ANSWER True
Fees charged by a broker not associated with a policy of insurance and not appearing
on the policy face are not subject to surplus lines tax. T/F - ANSWER True
Colorado is a Broker Responsibility State. T/F - ANSWER True, with implementations to
Article V, Colorado complied with the federal requirements of the National Risk
Retention Association (NRRA) and subsequently became a broker responsibility state
Who has the responsibility of ensuring the financial stability and viability of the non-
admitted insurer? - ANSWER The Producer (Colorado Division of Insurance no longer
conducts a substantial financial review)
What should you do if you realize that you are late to report a policy from prior to 2017
but not before 2006? - ANSWER Contact the Colorado Division of Insurance (DOI) and
