§ 23-65-103 - Report and tax of independently procured coverages.
23-65-103. Report and tax of independently procured coverages.
(a) (1) Every insured or self-insured who in this state directly procures, causes to be procured, or continues or renews insurance in an unauthorized insurer, upon a subject of insurance resident, located, or to be performed within this state, including surplus line insurance when procured without use of a surplus lines broker pursuant to the surplus lines law of this state, within thirty (30) days after the date the insurance was so procured, continued, or renewed, shall file a written report with the Insurance Commissioner on forms designated by the commissioner and furnished to the insured upon request.
(2) The report shall show:
(A) The name and address of each named insured;
(B) The name and address of the insurer;
(C) The subject of the insurance;
(D) A general description of the coverage;
(E) The amount of premium currently charged; and
(F) Such additional pertinent information as is reasonably requested by the commissioner.
(3) If any insurance also covers subjects of insurance resident, located, or to be performed outside this state, a proper pro rata portion of the entire premium payable for all the insurance shall be allocated as to the subjects of insurance resident, located, or to be performed in this state, for the purposes of this section.
(b) Any insurance in an unauthorized insurer procured through negotiations or an application, in whole or in part, occurring or made within or from within this state, or for which premiums, in whole or in part, are remitted directly or indirectly from within this state, shall be deemed to be insurance procured, or continued, or renewed in this state within the intent of subsection (a) of this section.
(c) (1) For the general support of the government of this state there is levied upon the obligation, chose in action, or right represented by the premium charged or payable for the insurance a tax at the rate of two percent (2%) of the net direct amount of the premium.
(2) The insured shall withhold the amount of the tax from the amount of premium charged by and otherwise payable to the insurer for the insurance, and within thirty (30) days after the insurance was so procured, continued, or renewed, and coincidentally with the filing with the commissioner of the report provided for in subsection (a) of this section, the insured shall pay the amount of the tax to the Treasurer of State through the commissioner.
(d) If the insured fails to withhold from the premium the amount of tax levied pursuant to this section, the insured shall be liable for the amount thereof and shall pay the amount to the commissioner within the time stated in subsection (c) of this section.
(e) The tax imposed pursuant to this section if delinquent shall bear interest at the rate of six percent (6%) per annum, compounded annually.
(f) The tax shall be collectible from the insured by civil action brought by the commissioner.
(g) This section does not abrogate or modify and shall not be construed or deemed to abrogate or modify any provision of 23-65-101, which is unauthorized insurance transactions prohibited, or 23-65-102, which is suits by unauthorized insurers prohibited, or any other provision of the Arkansas Insurance Code.
(h) This section does not apply to life or accident and health insurance.
(i) (1) The tax specified in subsection (c) of this section shall not be due and payable to this state in the event the unlicensed or unauthorized insurer reports and pays premium tax to this state pursuant to 26-57-603 et seq., or other applicable premium tax laws for these independently procured coverages.
(2) Upon receipt of duplicate payment of tax from the insured and the unlicensed or unauthorized insurer, this state shall refund to the insured the amount of the duplicate payment.