The national guides cover the specialty coverages in this area: inland marine, crime, surety, professional liability, umbrellas and flood. This guide covers Wyoming's surplus lines law (Wyo. Stat. 26-11), where many specialty risks are placed, plus a few Wyoming definitions that show up on the exam.

When surplus lines may be used (26-11-102, 26-11-104)

• Surplus lines placement follows the rules of the insured's home state only.
• Coverage must go through someone with a current Wyoming surplus lines license.
• The full amount must not be available, after diligent effort, from admitted insurers writing that kind of insurance in Wyoming.
• Coverage may not be exported to get a lower rate or better contract terms.
• Exempt commercial purchasers don't need a diligent search if, after disclosure, they ask in writing for a nonadmitted placement.
• Reinsurance and wet marine and transportation insurance are among the exempt kinds.

Disclosure (26-11-109)

• The policy carries a notice in at least 10-point bold type that losses won't be paid by the Wyoming Insurance Guaranty Association or the Wyoming Life and Health Insurance Guaranty Association.
• Before placement, the applicant signs and dates a written notice. The broker keeps the signed copy.

The broker (26-11-105 to 26-11-118)

• A resident surplus lines license requires:
  • a current P&C producer license
  • fees and an application
  • passing a written exam
  • a Wyoming office
• The broker posts a $10,000 bond to secure lawful conduct and prompt payment of surplus lines taxes.
• The broker files a report within 45 days after placing the insurance.
• Tax: the broker collects and pays 3% of gross premiums, less return premiums.
• A surplus lines broker may accept business from any producer licensed for that kind of insurance and pay them a commission.
• Once the broker receives the premium, the insurer is treated as having received it. The insurer is liable for covered losses and unearned premium (26-11-111).
• Surplus lines contracts are fully valid and enforceable, like contracts issued by admitted insurers (26-11-110).

Wyoming definitions

• Portable electronic device insurance is treated as inland marine, within property and casualty (26-9-202(a)(xi)).
• Crop insurance includes multi-peril crop and revenue protection against market swings (26-9-202(a)(xxi)). Producers with the property line don't need a separate crop exam.
• Professional liability (malpractice) is a kind of casualty insurance (26-5-106(a)(x)). Nonrenewal of health care malpractice policies requires 90 days' notice (26-35-203).

Common exam traps

• Surplus lines needs a diligent search among admitted insurers, and a lower premium is never a valid reason.
• The surplus lines tax is 3%, and the report is due within 45 days.
• Surplus lines insureds sign a disclosure and have no guaranty association protection.
• The surplus lines broker bond is $10,000.
• Crop authority comes with the property line.