CA| Bulletin #1518 from the Surplus Line Association of California reminds surplus line brokers that a risk may be placed with a nonadmitted insurer in California only when coverage is unavailable from admitted insurers actually writing that type of insurance, unless the risk is on the California Export List or qualifies as a commercial insured under Insurance Code section 1760.1(b). It emphasizes that a diligent search must be conducted in good faith for each risk before placement, and while the search may be performed by the surplus line broker, retail producer, or both, the surplus line broker remains ultimately responsible for ensuring the search is properly completed and accurately documented on the SL‑2 form.
The bulletin clarifies that a declination requires an actual submission and refusal of the specific risk by an admitted insurer, that declinations cannot be reused for similar but different risks, and that brokers must confirm each listed declination is from an insurer admitted and licensed for the relevant line of business in California. It also notes that SL‑2 declination entries must include contact information so California Department of Insurance investigators can verify them, warns that unverifiable declinations may trigger further inquiry and potential enforcement action.