What should surplus lines brokers prioritize to stay compliant?

Surplus lines brokers must prioritize staying updated on regulatory changes and requirements to ensure they operate within the legal framework governing their industry. The surplus lines market is subject to specific regulations that can vary significantly from state to state. This makes it essential for brokers to keep abreast of any updates or modifications to these regulations to avoid compliance issues.

By understanding the changing landscape of laws and regulations, brokers can effectively manage their risks and protect themselves and their clients. This includes knowing how to properly place coverage, filing requirements, and any applicable taxes or fees associated with surplus lines transactions. Failing to stay informed could lead to penalties, loss of licensure, or legal challenges, which could jeopardize their business.

While monitoring competitor strategies, increasing marketing efforts, and expanding product lines can be beneficial for growth and development, these strategies do not directly address the critical compliance aspect that is foundational to a surplus lines broker's operations. Prioritizing compliance helps ensure the long-term viability of the broker’s business in a highly regulated environment.