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Insurance Companies: Company Fees, Taxes, Charges and Deposits | Department of Financial Services

October 23, 2022

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estimated retaliation tax form (pdf)

company fees

cover letter: $30 [insurance law § 9107] (foreign and domestic)
Statute amendment filing: $10 [insurance law § 9107] (national)
Initial license issuance: $10 [insurance law § 9107] (foreign and domestic)
annual license renewal: none (foreign)
Certificate of Compliance, Certificate of Appraisal, or Certificate of Deposit: $5 each [insurance law § 9107] (foreign and domestic)
name processing: $25 [11 nycrr 87] (foreign and domestic)

taxes and charges

retaliatory fees and taxes: payable to the superintendent of financial services [insurance law §1112]

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insurers domiciled in states where new york insurers collectively pay higher taxes and fees or lower allowable credits than those charged in new york are required to pay the superintendent of financial services an amount equal to the one imposed on new york insurers by the laws of that other state.

Reading: What rate is insurance premium tax

an estimated payment is required equal to 90% of the final amount determined to be due for the second prior calendar year or 80% of the final amount determined to be due for the applicable calendar year, whichever is less . the estimated payment is due on or before December 15 of the applicable calendar year.

final calculations are calculated by dfs in the manner used by the state of domicile and insurers are billed when applicable.

franchise tax: payable to the new york state department of taxation and finance within two and a half months after the close of the reporting period [tax law, section 33]

every insurance corporation, national, foreign or foreign, for the privilege of exercising its corporate franchise and doing business in this state, is obliged to pay a franchise tax computed in accordance with the provisions of article 33 of the law fiscal like this:

life insurance companies

Franchise taxes for life insurance corporations are calculated on four bases: 1) an allocated total net income base, 2) an allocated business and investment capital base, 3) allocated net income plus alternative base of compensation, and 4) minimum tax of $250 base. a tax on the assigned subsidiary capital is added to the highest base. To this sum is added the tax on gross direct premiums, less return premiums and dividends paid to the insured, on risks located or resident in the state. Taxable premiums include all amounts received as consideration for insurance contracts or reinsurance contracts, and include premium deposits, appraisals, policy fees, membership dues and any other compensation for such contracts. the tax rate on life premiums is 0.7%. the calculated tax liability cannot be less than 1.5% nor more than 2% of the taxable premiums. Forms to be filed along with instructions can be accessed on the New York State Department of Finance and Taxation website.

non-life insurance companies

franchise tax for non-life insurance corporations is based solely on gross direct premiums, less return premiums and dividends paid to policyholders, on perils located or resident within the state . Taxable premiums include all amounts received as consideration for insurance contracts or reinsurance contracts, and include premium deposits, appraisals, policy fees, membership dues and any other compensation for such contracts. the tax rate is 1.75% for accident and health premiums and 2.00% for all other non-life premiums. the minimum tax is $250. Forms to be filed along with instructions can be accessed on the New York State Department of Finance and Taxation website.

A tax credit of 90% of retaliatory taxes paid in other states by domestic insurers is allowed; but this credit may not exceed the amount of the tax provided for in article 33 and must be claimed in the year in which it is paid.

mta surcharge: payable to the new york state department of taxation and finance [tax law section 33]

Any domestic, foreign, or foreign insurance corporation subject to section 33 taxation that does business, employs capital, owns or leases property, or maintains an office in the metropolitan commuter transportation district (includes new york counties, bronx, queens, kings, richmond, dutchess, nassau, orange, putnam, rockland, suffolk and westchester), will annually pay a tax surcharge on taxes levied under section 33 after deduction of credits that would otherwise be allowable under section 33 assigned to said district. Forms to be filed along with instructions can be accessed on the New York State Department of Finance and Taxation website.

Estimated Franchise Tax: Payable to the New York State Department of Taxation and Finance [Tax Law Section 33]

If the corporation reasonably expects to owe more than $1,000 in franchise taxes after credits, estimated payments are required.

Fire Insurance Premium Tax: [insurance law §§ 9104 and 9105] payable to the superintendent of financial services and the cities of new york and buffalo.

Payable annually on February 15 for foreign mutuals and March 1 for foreign stock insurers at the rate of 2% of the amount of premiums received during the year by the insurer for any insurance against loss or fire damage on property located in new york state. A Fire Department Code/Street List is available on the Department of Financial Services website for use in connection with this tax. A credit for this tax is allowed against the tax established in article 33 of the tax law.

Security Funds: Funds are held to pay claims against insolvent insurance companies as follows:

workers’ compensation security fund [workers’ compensation law, section 6a]: payable quarterly to the superintendent of financial services on May 15, August 15, November 15, and November 15. February on direct written premiums less premiums (mutual companies may also deduct dividends) for policies written to secure payment of compensation under New York State workers’ compensation law.

motor vehicle liability guarantee fund [insurance law § 7601]: payable quarterly to the superintendent of financial services on May 15, August 15, November 15, and February 15 at a rate of 3% on direct written premiums less dividends on bonds and insurance policies written to secure the payment of legal or liability claims or judgments resulting from the defective operation, maintenance, use or construction of a motor vehicle that causes: (a) damages for an incident of death or injury to persons, (b) damages for the incident of injury or destruction of property as provided by § 370 of the New York State Vehicle and Traffic Law (indemnity bonds or insurance policies on vehicles carrying passengers for hire).

Property/casualty insurance guarantee fund [insurance law § 7603]: payable quarterly to the superintendent of financial services on May 15, August 15, November 15 and February 15 at various rates on direct payment premiums less return premiums and less dividends on property/casualty lines of insurance.

life insurance company guaranty corporation [insurance law § 7709]: payable to the life insurance company guaranty corporation. evaluations of national and foreign life insurers.

additional evaluations:

department of motor vehicles [vehicle and traffic law §§ 317 and 363]: Insurers writing bodily injury insurance for automobiles are subject to an assessment of administrative costs related to the law of Motor Vehicle Financial Assurance and the Motor Vehicle Safety Liability Act.

auto accident indemnity corporation [insurance law § 5207]: Insurers writing motor vehicle liability insurance are subject to an assessment by the auto accident indemnity corporation in relation to the operating costs of the corporation.

workers’ compensation board [workers’ compensation law §§ 15(8), 25-a, 151, 214 and 228]: insurers authorized to transact workers’ compensation and liability insurance The employer’s civil liability are subject to assessments by the workers’ compensation board for board administrative costs, the special disability fund, the fund for reopened cases, and the special fund for disability benefits.

deposits

only accident and health companies

$200,000. par, market and statement values must be deposited in qualified securities with the state of origin for the protection of all policyholders. see §§ 1318, 1319 and 4206 of the new york state insurance law.

life companies

$200,000 for life and/or annuities; An additional $200,000 if you also have an accident and health license. par, market and statement values must be deposited in qualified securities with the state of origin for the protection of all policyholders. see §§ 1318, 1319 and 4206 of the new york state insurance law.

real estate/casualty companies

$500,000 or minimum or excess capital, whichever is less, but not less than $400,000 for companies that write two or more types of insurance.

In addition, those insurers seeking to reinsure lines other than those lines for which they are licensed to underwrite directly or seeking to underwrite direct business outside of the US. uu. they must have a deposit of $3,000,000.

It is recommended that the company include a cushion (i.e. 20%) in its deposit to compensate for fluctuations in the market value of the securities in order to minimize the chances of the market value falling below the amount required.

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October 23, 2022

0 56 6 minutes read