The surplus lines industry represents a significant portion of the country's available insurance capacity, with estimated total premiums of $38.6 billion in 2006. Of that amount, Florida accounted for roughly $4.6 billion; making the state the second largest surplus lines market in the country with total premiums reaching $4.6 billion. Considering all the market's moving parts such as agents, brokers, reinsurers, and carriers, it is amazing that a market as complicated and large as Florida's, manages to run along as smoothly as it does. But that is no accident. Much of that credit goes to the one entity that is charged with pulling all the strings together, namely the Florida Surplus Lines Services Office.

The FSLSO was created by the legislature in 1999 as a means to provide some regulatory oversight of the excess and surplus lines industry, which largely falls outside of the insurance code. Among other things, the office is responsible for collecting all taxes and assessments such as the FSLSO service fee of 0.1 percent on all taxable and non-taxable premiums, with the exception of policies issued to government entities. The service office also collects the Department of Financial Service's premium tax of five percent of all taxable premiums. All surplus lines policies issued in 2006 are subject to a 6.84 percent assessment levied by Citizens Property Insurance Corporation.

While collecting taxes and assessments is a primary function of the FSLSO, the service office also works with regulators on a variety of other subjects. FSLSO Public Information Specialist Ashlee Weber noted that the service office must review all applications by companies seeking to write coverage in the state before that application can be forwarded on to the Office of Insurance Regulation for final action. The service office also monitors agents, although the DFS has the statutory authority to suspend or revoke and agent's license.