2019 New Mexico Statutes
Chapter 59A - Insurance Code
Article 14 - Surplus Line Insurance
Section 59A-14-14 - Evidence of insurance; policy changes; penalties.

A. Upon placing surplus lines insurance, the surplus lines broker shall promptly deliver to the insured evidence of the insurance consisting either of the policy or, if the policy is not then available, a certificate complying with Subsection D of this section, a cover note, a binder or other evidence of insurance. The certificate, cover note, binder or other evidence of insurance shall be completed and signed by the surplus lines broker and shall set forth the description and location of the subject of the insurance, the coverage limits, the name and address of the insured, the name and address of the surplus lines insurer and the name, address and telephone number of the surplus lines broker.

B. No surplus lines broker shall issue or deliver any evidence of insurance or purport to insure or represent that insurance will be or has been written by any eligible surplus lines insurer without the insurer's prior written authorization, via telefax or otherwise, to cause the risk to be insured or documentation from the insurer in the regular course of business that such insurance has been granted.

C. If, after delivery of any evidence of insurance, there is any change in the identity of the insurer, in the proportion of the risk assumed by any insurer or in the coverage, terms or conditions stated in the original evidence of insurance, the surplus lines broker shall promptly issue and deliver to the insured, either directly or through the producing broker, an appropriate substitute for or endorsement of the original document, accurately showing the current status of the coverage and responsible insurers.

D. As soon as reasonably possible after the placement of any surplus lines insurance, and in no event later than thirty days after coverage commences, the surplus lines broker shall deliver a complete copy of the policy or, if the policy is not then available, a certificate of insurance to the insured to replace any evidence of insurance previously issued. Each policy of insurance shall contain or have attached thereto a complete record of all policy declarations and limits, insuring agreements, deductible amounts, conditions, exclusions, clauses, endorsements and all other material terms and conditions.

E. Any surplus lines broker who fails to comply with the requirements of this section shall be subject to the penalties provided in Section 59A-1-18 NMSA 1978 or to any greater applicable penalty otherwise provided by law.

History: 1978 Comp., § 59A-14-14, enacted by Laws 1991, ch. 125, § 18; 2011, ch. 127, § 12.

Repeals and reenactments. — Laws 1991, ch. 125, § 18 repealed former 59A-14-14 NMSA 1978, as enacted by Laws 1984, ch. 127, § 252, relating to evidence of insurance, changes, and penalties, and enacted a new section, effective April 3, 1991.

The 2011 amendment, effective July 1, 2011, eliminated the requirement that the evidence of insurance set forth the coverages, amount of deductibles, premium and rates, taxes, and risk assumed by each insurer.

Miscommunication may result in coverage despite exclusion. — Since the surplus lines insurer authorized a surplus lines broker to issue insurance, the insurer must assume responsibility for inadequate insurance coverage resulting from miscommunications made between intermediaries during the process of selling insurance to the insured. Since the insured initially sought coverage for a particular injury, the insured's damages are covered under the policy notwithstanding an exclusion for that particular injury. Barth v. Coleman, 1994-NMSC-067, 118 N.M. 1, 878 P.2d 319.