What is the current tax rate for surplus lines insurance premiums in New Jersey?

The current tax rate for surplus lines insurance premiums in New Jersey is 5%. This rate is applicable to premiums collected for surplus lines insurance, which refers to insurance that is not available from admitted insurers within the state. Surplus lines are important as they provide coverage options where traditional markets may not suffice, such as in unique or high-risk situations.

In New Jersey, the tax is imposed on the policyholder and must be collected by the surplus lines broker when placing the coverage. Understanding the tax rate is essential for compliance and accurate accounting for both brokers and clients engaging in surplus lines transactions. This fee is intended to regulate the industry while ensuring that the state receives its due revenue from these specialized insurance policies.