N.M. Code R. § 13.19.2.9 – Prohibition on Artificial Division of Coverage

A. Artificial divisions of coverage in one class or any form of coverage under one class into two or more proposed contracts for the purpose of obtaining a marketing or rate advantage upon the entire risk is prohibited where the entire coverage sought in that class or form would be acceptable as a single contract to an authorized insurer.
B. Combinations of primary coverage and excess coverage shall not be considered a violation of this section if the excess insurance is written by an eligible surplus lines insurer:
(1) because of a refusal in writing by the primary authorized insurer to assume the limits of liability desired by the person seeking insurance; or
(2) on a written demand, including specific reasons, by the person seeking insurance that the entire liability not be placed with one insurance company.
[1/1/99; Recompiled 11/30/01]