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Wednesday, April 10, 2013

NAIC Offers Free Membership to Entice States to Join NIMA

The Nonadmitted Insurance Multistate Agreement (NIMA), which “provides a mechanism to report, collect, allocate and distribute surplus lines tax revenues consistent with the Non-admitted and Reinsurance Reform Act (NRRA),” is offering states a free, one-year associate membership, in an effort to tempt states to join NIMA.

If a state joins NIMA they can continue to collect surplus lines premium taxes and gain access to NIMA’s clearinghouse services, which enables them to report single and multistate policies without sharing tax revenue.

At this time only six states and territories have joined NIMA: Florida, Louisiana, Puerto Rico, South Dakota, Utah and Wyoming.  Some states have resisted joining NIMA because they believe they will lose premium tax dollars because member states agree to share revenue from premium taxes. 

Learn more about NIMA.