The NRRA was signed into law by President Barack Obama on July 21, 2010, as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The bill, which includes language to standardize the reporting, allocation and payment of non-admitted insurance premium tax on multi-state risks, is set to take effect July 21. 

The NRRA grants the insured's home state exclusive authority to regulate and tax surplus lines insurance that includes multi-jurisdictional boundaries. Additionally, the NRRA bill provides states the ability to enter into an agreement to collect and share premium taxes for these multi-state risks.

This provision sets the stage for what has become perhaps the legislation's greatest challenge as states are empowered to facilitate and enter into a compact or agreement for the purposes of creating national or uniform standards regarding the collection, allocation and distribution of taxes among the states involved in multi-state surplus lines risks. States that fail to adopt some means of tax allocation system will be subject to a single state taxation that allows the home state to then retain 100 percent of the tax on the gross premium effective July 21. Competing Proposals
In response to this provision, the National Association of Insurance Commissioners (NAIC) has worked to develop a tax-sharing model that would streamline the allocation of surplus lines premium taxes with multi-state exposures. Currently, two interstate tax sharing agreements have been proposed and remain under consideration: the Surplus Lines Insurance Multi-State Compliance Compact (now known as SLIMPACT-LITE) and the Non-Admitted Insurance Multi-State Agreement (NIMA).