Statement of Diligent Effort
FSLSO provides this downloadable diligent effort form as a sample for surplus lines agents. Per F.S. 626.916, no insurance coverage is eligible for export unless it meets certain conditions. It is the responsibility of the Surplus Lines agent to verify that a diligent effort has been made by requiring a properly documented statement of diligent effort from the retail or producing agent.
The diligent effort search is required for all lines of coverage eligible for export under F.S. 626.916 that are not exempt under F.S. 627.062(3)(d)1 or related to indemnity of deductibles for property insurance. This requirement also does not apply to wet marine, transportation, or aviation risks subject to F.S. 626.917.
Guidance for Completing the Diligent Effort Form
These guidelines serve to assist in the proper completion of the Diligent Effort form. Diligent Effort forms are examined during your compliance review; therefore, we suggest you share this with the retail/producing agent from whom you are accepting business.
Per F.S. 626.916, no insurance coverage is eligible for export unless it meets certain conditions. Completing a diligent search and providing a properly documented Statement of Diligent Effort is one of those conditions.
- It is the responsibility of the retail/producing agent to conduct the diligent search and to complete and sign the Diligent Effort form.
- The surplus lines agent should obtain the form from the retail/producing agent and maintain it in their files.
- Declinations should be obtained from only insurance companies currently approved in Florida to write the type of coverage initially sought. For example, a personal lines quote should not be requested from a company writing only commercial risks to secure a declination.
- Only admitted insurance companies should be listed on the form, not wholesale brokerages.
- All the fields on the form should be completed and should be legible.
- The full name and contact information of the person providing the declination should be recorded on the form.
- In the event of an online declination, the surplus lines agent should request a copy of the online declination from the retail/producing agent.
- The specific reason for the declination should be provided in as much detail as possible.
- The date the declination is obtained should be on or before the effective date of the policy and recorded on the form.
- Declinations typically should not be obtained more than 60 days before the effective date of the coverage being sought.
- The retail/producing agent conducting the diligent search should sign and date the form when it is completed.
- The form should list three admitted insurance companies unless the residential structure has a replacement cost of $700,000 or more, in which case you are only required to have one declination from an admitted insurance company.
Surplus lines agents must verify that a diligent effort has been made by requiring a properly documented statement of diligent effort from the retail or producing agent. However, to comply with the diligent effort requirement, the surplus lines agent’s reliance must be reasonable under the particular circumstances surrounding the export of that specific risk. Reasonableness shall be assessed by considering factors including, but not limited to, a regularly conducted program of verification of the information provided by the retail or producing agent. Declinations must be documented on a risk-by-risk basis.