The Georgia Office of the Commissioner of Insurance and Safety Fire published a bulletin to remind surplus line insurers and brokers that charging unauthorized fees when selling an insurance policy is unlawful and in violation of the Georgia Unfair Trade Practices Act. The Office of the Commissioner has heard reports of surplus line insurers and brokers collecting unauthorized fees.

A surplus line insurer or broker may not charge any amount in excess of the premiums and charges for insurance specified by the insurance policy. Instances where reasonable fees can be charged include:

• The surplus lines producer fee listed as a line item on the declaration page
• The fee is reported as premium for the purposes of taxation
• The fee is included in the calculation of surplus lines premium tax

Other unauthorized fees would be in violation of O.C.G.A. § 33-6-5(6)(B)(ii) and would be considered an unfair method of competition and an unfair and deceptive act. The statute does not prohibit surplus lines brokers from charging and collecting applicable state and federal taxes in addition to the premium required by the insurer. Violation of the Georgia Unfair Trade Practices Act may result in up to a $5,000 penalty for each violation.