What additional charges can a surplus lines broker include for placing insurance risks?

Surplus lines brokers are permitted to include service fees when placing insurance risks. These fees are intended to compensate the broker for additional services provided to the client beyond the basic placement of the insurance. This can encompass a range of activities including consulting, risk assessment, and ongoing support related to the insurance policy.

Service fees can help cover the operational costs associated with the broker's role in ensuring that the clients understand their coverage and fulfilling any regulatory requirements. Therefore, including these fees represents a legitimate way for the broker to enhance their compensation while adhering to industry regulations regarding surplus lines.

In contrast, policy premiums are the basic costs of the insurance coverage itself and are not an additional charge by the broker. Brokerage commissions, while relevant, are typically predetermined and included in the calculations of the total cost for the insurance, rather than being an additional charge. Underwriting fees typically relate to the costs incurred by the insurer for evaluating risk, and these are not additional charges that a broker would impose on clients.