N.Y. Comp. Codes R. & Regs. tit. 11 § 27.9

Current through Register Vol. 46, No. 45, November 2, 2024

Section 27.9 - Premium tax allocation

(a) For insurance contracts that have an effective date prior to July 21, 2011, an excess line broker shall determine the taxable portion of the premium by using the method of allocation, prescribed in the allocation schedule contained in Appendix 4 of this Part, pertaining to the appropriate classification for the property or risk.

(b) If the allocation schedule does not identify a classification appropriate to the property or risk being insured, the excess line broker shall use an alternative equitable method of allocation for the property or risk.

(c) For insurance contracts that have an effective date on or after July 21, 2011, where the property or risk is located in both the United States and outside the United States, an excess line broker shall determine the taxable portion of the premium by using the method of allocation, prescribed in the allocation schedule contained in Appendix 5 of this Title, pertaining to the appropriate classification for the property or risk.

(d) If a policy covers more than one classification:

(1) for any portion of the coverage identified by a classification on the allocation schedule, the premium tax shall be computed by using the allocation schedule for the corresponding portion of the premium;

(2) for any portion of the coverage not identified by a classification on the allocation schedule, the premium tax shall be computed in accordance with subdivision (b) of this section; and

(3) for any portion of the coverage where the premium is indivisible, the tax shall be computed by using the method of allocation pertaining to the classification describing the predominant coverage.

(e) If the information provided by the excess line broker is insufficient to substantiate the excess line broker's method of allocation, or in the event that the superintendent determines the broker's method is incorrect or inequitable, the superintendent shall determine the equitable and appropriate amount of premium tax due to this State, as follows:

(1) where the allocation schedule identifies a classification appropriate to the coverage, the superintendent shall use the method prescribed in subdivision (a) of this section; and

(2) where the allocation schedule does not identify a classification appropriate to the coverage, the superintendent, in determining the equitable and appropriate amount of tax due to this State, shall give significant weight to documented evidence of the underwriting bases and other criteria used by the insurer and shall also consider other available information, to the extent sufficient and relevant, including:

(i) for insurance contracts that have an effective date prior to July 21, 2011, the percentage of the insured's physical assets in this State, percentage of the insured's employee payroll in this State, percentage of the insured's sales in this State, and the amount of premium tax paid to another jurisdiction for the policy; and

(ii) for insurance contracts that have an effective date on or after July 21, 2011, where the property or risk is located in both the United States and outside the United States, the percentage of the insured's physical assets in the United States, percentage of the insured's employee payroll in the United States, percentage of the insured's sales in the United States, and the amount of premium tax paid to another jurisdiction for the policy.

N.Y. Comp. Codes R. & Regs. Tit. 11 § 27.9

Amended, New York State Register October 8, 2014/Volume XXXVI, Issue 40, eff.10/8/2014