Can agents charge additional fees for surplus lines placements?

Agents may charge extra fees for processing surplus lines insurance placements because the surplus lines market often involves additional work and complexity compared to standard market insurance. Surplus lines are used for risks that are not covered by admitted insurers, which requires agents to have specialized knowledge and potentially deal with more paperwork, negotiation, and compliance with various regulations.

Charging these additional fees helps agents compensate for the extra effort involved in these placements. It's important to note that while agents can charge these fees, they must still adhere to any relevant regulations governing disclosure and transparency regarding these costs. This ensures that consumers are aware of what they will be charged and the reasons for any additional fees. Therefore, the ability to impose these extra fees is aligned with the broader practices of the insurance industry, where agents are often compensated for their expertise and the specific services they provide.