Is there a new law governing notices that are mandated for surplus line policies?
Yes. Effective on September 24, 2025, the notice requirements for surplus lines coverage have been revised as discussed below. The law can be found at 24-A M.R.S. § 2009, as repealed and replaced by P.L. 2025, ch. 348 (LD 1837).
What are the new notice requirements associated with surplus lines insurance in Maine?
Initial Notice to Applicants: Every application for surplus lines insurance must have affixed to it a notice printed in 16-point type that contains this specific language:
Notice: A nonadmitted or surplus lines insurer is issuing the insurance policy that you have applied to purchase. These insurers do not participate in insurance guaranty funds. The guaranty funds will not pay your claims or protect your assets if the insurer becomes insolvent and is unable to make payments as promised. For additional information about the above matters and about the insurer, you should ask questions of your insurance agent, broker or surplus lines broker. You may also contact your insurance department consumer helpline.
As discussed below, this is uniform multistate language. Insurers and producers are encouraged, but not legally required, to add a separate sentence for Maine applications explaining: “Questions? Contact the Property and Casualty Division of the Maine Bureau of Insurance at 1-207-624-8475, 1-800-300-5000 (toll free), or Insurance.PFR@maine.gov.”
To proceed with an application for surplus lines coverage, the applicant must sign and date a copy of the notice. If the application is accepted and a policy is issued, the producer must send a copy of the signed and dated notice to the insured at the time each policy is delivered (meaning the initial policy and renewal policies). This copy of the signed and dated notice must be affixed to the policy. The insurance producer must keep the signed notice in its file for a period of 5 years from expiration of the policy.
Supplemental Notice to Insureds:
There is also a second notice that is required after the application is accepted and the contract is delivered. Every surplus lines policy must contain or be accompanied by a notice that includes a statement that:
- The insurer with which the licensee places the insurance is not licensed by this State and is not subject to its supervision; and
- In the event of the insolvency of the surplus lines insurer, losses will not be paid by any state insurance guaranty association.
A copy of this notice must be maintained by the surplus lines producer with the records of the contract and be available for possible examination.
What if the surplus lines insurer requires an application for each term of coverage? Must each renewal application be accompanied by a new notice in 16-point type?
To the extent that applications are sent to consumers who wish to apply for surplus lines coverage, those applications must have affixed to them the notice that must be in 16-point type. The applicant must then sign and date the notice and a copy of the notice must accompany the delivery of each policy. This is the case even if the applicant is currently insured by the insurer and the application concerns the renewal of the policy that is currently in effect.
It bears noting that, generally, before a surplus lines producer may attempt to place risks in the nonadmitted market, the producer must first conduct a diligent effort to place the risk in the admitted market.1 A producer must conduct this diligent effort before initially placing the risk in the nonadmitted market and also must conduct a diligent effort to place the risk in the admitted market at the expiration of the initial coverage term.
How do the new notice requirements relate to the stamp we’ve been using for surplus lines policies?
The new law repeals and replaces a law that formerly mandated that every insurance contract procured and delivered as a surplus lines coverage have stamped upon it the following language, accompanied by the name of the surplus lines producer: “This insurance contract is issued pursuant to the Maine Insurance Laws by an insurer neither licensed by nor under the jurisdiction of the Maine Bureau of Insurance."
Can you please provide guidance regarding where in the policy the notice should be affixed?
The law does not specify on which page of the policy the initial notice to applicants should be affixed. The supplemental notice to insureds may either be included in the policy language or delivered as a separate document accompanying the policy.
Can both notice requirements be fulfilled with one document that contains all the required notices?
Yes. A document that contains both notices could be affixed to the application, a copy of which would need to be signed and dated by the applicant. This signed and dated copy could then be affixed to the policy and this would fulfill the notice requirements.
Why was the surplus lines notice requirement updated?
The law was updated to help establish uniformity across American jurisdictions. The new statutory notice comes verbatim from the NAIC Nonadmitted Insurance Model Act, Model Law #870, § 5(N)(5). Requiring this language should not be unduly burdensome, as there are other jurisdictions that mandate the same notice.
1Producers may place some coverages in the nonadmitted market without adhering to the diligent effort requirement. These coverages are wet marine and transportation insurance, insurance on out-of-state risks, and insurance on interstate railroad and aircraft operations. See 24-A M.R.S. § 2002-A(3) for more details. Liability insurance purchased through a risk purchasing group is also exempt from the diligent effort requirement. See the Maine Liability Risk Retention Act, 24-A M.R.S. §§ 6091-6104. Also, the federal Nonadmitted and Reinsurance Reform Act of 2010 exempts placement of coverage for exempt commercial purchasers under some circumstances. See Maine Bureau of Insurance Bulletins 457 and 378 for more information.