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SLSOT PROCEDURES
MANUAL
SECTION 1 - Introduction
 Preface to Manual - updated 9/1/2005
Section 1 - updated 9/1/2005
The concept of a stamping office to assist in the
oversight of a state surplus lines market is not new. In fact, stamping
offices began operating in Oregon and California as early as 1938.
Currently, there are fourteen states with a stamping office and more are
considering establishing one.
The possibility of a stamping office in Texas that could provide effective
self-regulation of the surplus lines industry was a subject of much
discussion among the members of the Texas Surplus Lines Association (TSLA)
for many years, before action was finally initiated to create one.
As the 70th Texas Legislature came into session in 1987, considerable
concern was expressed at the State Board of Insurance (now the Texas
Department of Insurance) about the ability of that agency to provide
proper regulation of the surplus lines industry. Uncertainty arose as a
result of two problems. First, Texas faced a severe fiscal shortfall,
affecting the budgets of all state agencies. Secondly, restrictions in the
availability and affordability of liability insurance coverages nationwide
led the Texas Legislature to closely scrutinize the activities of the
insurance industry. In response to these concerns, TSLA brought forward
the stamping office concept, believing that effective self-regulation
could be achieved to the benefit of all parties, at no cost to the state
treasury and without the necessity for punitive laws. A committee composed
of members of the TSLA Board of Directors, Texas Department of Insurance
staff, and members of interested insurance industry organizations drafted
Senate Bill 989, the enabling legislation creating the Surplus Lines
Stamping Office of Texas.Also during the 70th legislative session,
heightened concern over the financial solvency of non-admitted market
insurers generated Senate Bill 526, again drafted with the assistance of
the Texas Surplus Lines Association. SB 526 resulted in increased capital
and surplus requirements for surplus lines insurers. The bill was based
upon a model law of the National Association of Insurance Commissioners (NAIC).
The purpose of the Surplus Lines Stamping Office is to assist the Texas
Department of Insurance in the regulation of surplus lines insurance and
to encourage compliance by surplus lines agents and insurers with the
surplus lines laws and regulations of the state. Although the Stamping Office performs many functions, its principle
responsibilities fall under three main categories: evaluation of surplus
lines insurers for eligibility to write in Texas; review of all surplus
lines insurance policies procured by Texas licensed surplus lines agents;
and education.The Stamping Office performs other duties, such as tabulating extended
coverage premiums written by surplus lines affiliates of admitted insurers
for use by the Texas Windstorm Insurance Association in determining
assessments. We are also the sole source for detailed statistical data on
the Texas market.Over the
years, as the Texas surplus lines industry has grown to serve the second
largest market in the US, with annual state premiums now exceeding $2.5
billion, the Stamping Office likewise has evolved. Probably the best
evidence of this fact is the deployment in July, 2003 of an Electronic Filing System for the reporting
of policy data to our office. Ultimately, however, our goal remains as it
was in 1988 -- to encourage a stable, efficient, financially strong
surplus lines market.
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Gilbert C.
Hine, Jr., Chair,
CPCU (12/31/10)
McClelland & Hine, Inc.
2200 Thousand Oaks Dr., #100
(78232-3925)
P.O. Box 700930
San Antonio, TX 78270-0930
Thomas M. Mace, Vice-Chair (12/31/08)
Nabors Industries
515 West Greens Road, Suite 1200
Houston, TX 77067
Bart P. Koch, Secretary (12/31/09)
Tejas American General Agency, LLC
1620 LaJaita Drive, Suite 300 (78613)
P.O. Box 3009
Cedar Park, TX 78630-3009
Martha A. Rider (12/31/08)
Retired - Fort Bend County
Houston, Texas
Banos N. Georgiou (12/31/08)
Burnett & Company, Inc.
2603 Augusta
Drive, Suite 1250
Houston, Texas 77057-5639
James E. Huckaby, ARM-P (12/31/10)
Mesquite Independent School District
405 East Davis Street
Mesquite, TX 75149-4701
David E. Kester (12/31/09)
Harris County
1310 Prarie, 4th Floor
Houston, TX 77002
William G. Reynolds (12/31/2010)
Atlantic Casualty Insruance Company
400 Commerce Court
Goldboro, NC 27534
Carl F. Roeder (12/31/09)
Western Surplus Lines Agency, Inc.
#2 Village Drive, Suite 300
Abilene, TX 79608-6609
Philip R. Ballinger, CPCU, ASLI
Executive Director
Surplus Lines Stamping Office of Texas
805 Las Cimas Parkway, Suite 150
Austin, TX 78746-5493
P.O. Box 160170
Austin, TX 78716-0170
1 (800) 449-6394 |
 Procedures Manual Directory
 Section 1 - Introduction
Section 2 - Filing With SLSOT
Section 3 - Chapter 101, Texas Insurance Code
Section 4 - Chapter 981, Texas Insurance Code
Section 5 - Surplus Lines Regulations
Section 6 - Premium Taxes
Section 7 - Miscellaneous Provisions
Section 8 - SLSOT Plan of Operation
Section 9 - Surplus Lines Insurers List
Section 10-Bulletins
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