Since it was passed by Congress in 2010, NAPSLO has worked to promote and preserve the intent and clear mandates of the Nonadmitted and Reinsurance Reform Act (NRRA), and the resulting uniformity and efficiencies in surplus lines regulation the NRRA was intended to achieve. The Association believes that, in the four years since its passage, the NRRA's national framework and establishment of home state regulation and taxation of surplus lines has produced tremendous benefits for our industry by ensuring one state, the home state of the insured, governs multistate risks.

The key reforms intended by the NRRA are to:

• Isolate the regulation and taxation of surplus lines transactions to one state, the home state of the insured;
• establish national uniform eligibility standards for U.S. based insurers who write surplus lines insurance;
• allow a licensed surplus lines broker to procure insurance from non-U.S. based insurers included on the NAIC Quarterly Listing of Alien Insurers;
• and establish a nationwide definition of an Exempt Commercial Purchaser for whom a broker can access the surplus lines market.

While great progress has been made in implementing these reforms, there is still work to be done to bring about the full spectrum of uniformity and efficiency envisioned by Congress. To address these remaining uniformity issues, the NAPSLO Legislative Committee and Board of Directors recently adopted Guiding Principles on Uniformity in State Surplus Lines Regulatory Requirements. The Committee identified a number of key areas where uniform standards are desired and beneficial. NAPSLO will present these principles to individual states as we continue our work to build national uniformity within the state based system of insurance regulation.

The surplus lines marketplace has proven to be an essential part of the national insurance market that operates successfully in the state-based regulatory system, which NAPSLO strongly supports. However, the current state based system can and should become more uniform and efficient. NAPSLO encourages all states to adopt the following uniform procedures for the regulation and taxation of surplus lines brokers and insurers.