Because of the importance and trust involved in performing surplus lines insurance placement, as a condition of licensure and continuing licensure, each licensee must be capable of discharging and must faithfully discharge to the citizens of this state the high degree of responsibility demanded of a surplus lines agent. A surplus lines agent may hold a license only on the following conditions and the Texas Department of Insurance may refuse or deny a license if any of the following conditions are not met:

1. (1) that the applicant is at the time of licensing authorized as an agent under the provisions of either Article 21.14 (Local Recording Agents) or Article 21.07-3 (Managing General Agents);
2. (2) that the applicant is competent and trustworthy with respect to handling surplus lines insurance, and maintains an office at one or more designated locations in this state;
3. (3) that the applicant has the facilities necessary for the accumulation and preservation of the records required to be kept by a surplus lines agent under the provisions of the Insurance Code, Article 1.14-2, and these sections;
4. (4) that the applicant has the facilities necessary for the collection, maintenance, reporting, and remitting to the state board of the gross premium tax in accordance with the Insurance Code, Article 1.14-2, and these sections;
5. (5) that the applicant possesses the knowledge and experience in the placement of insurance with licensed insurers sufficient to determine the eligibility of insurance for procurement in an unauthorized insurer under the conditions of the Insurance Code, Articles 1.14-1 and 1.14-2, and these sections;
6. (6) that the applicant possesses the knowledge and experience in the field of insurance sufficient to collect and analyze financial and other data necessary to determine the eligibility of the unauthorized insurer as a surplus lines insurer under the provisions of the Insurance Code, Articles 1.14-1 and 1.14-2, and these sections.

Source Note:The provisions of §15.2 adopted to be effective January 1, 1976; amended to be effective March 15, 1981, 6 TexReg 770; amended to be effective August 15, 1984, 9 TexReg 4289; amended to be effective March 11, 1992, 17 TexReg 1542.