A client sees the premium on a surplus lines quote, then sees a larger total. Later, they cancel early and get back much less than they expected. Both surprises come from the same place: surplus lines taxes and fees, and the minimum earned premium.
Explaining these at the quote stage, in plain language, prevents most of the complaints later.
The short version
- Taxes and fees: surplus lines policies carry a state surplus lines tax and, in some states, a stamping or filing fee. Carriers and brokers may add policy, inspection or broker fees.
- Minimum earned premium: the carrier keeps at least a set portion of the premium even if the policy is cancelled early.
- Fully earned fees: most fees aren't returned on cancellation.