33-2-302. Home state exclusive authority -- conditions precedent to sale of surplus lines insurance. (1) Pursuant to the Nonadmitted and Reinsurance Reform Act of 2010, Title V, subtitle B, of Public Law 111-203, the transaction of surplus lines insurance is subject to the statutory and regulatory requirements of the home state of the insured, regardless of whether a multistate risk is covered. If, at the time of the surplus lines insurance transaction, the home state:
(a) is Montana, the surplus lines insurance transaction is subject to the applicable statutory and regulatory requirements in Montana; or
(b) is not Montana, the Montana statutory and regulatory requirements regarding the surplus lines insurance transaction are preempted by the statutory and regulatory requirements of the home state.
(2) When Montana is the home state at the time of the surplus lines insurance transaction, the following apply:
(a) A producing insurance producer may request a surplus lines insurance producer to place or a surplus lines insurance producer may place a contract of insurance with an unauthorized insurer if:
(i) the insurer is an eligible surplus lines insurer;
(ii) the line of insurance or the full amount of the line of insurance cannot be obtained from authorized insurers or, in the case of a renewal, the line of insurance has not become available from an authorized insurer, as evidenced by one of the following:
(A) the producing insurance producer making a diligent effort to place the business with a minimum of three insurers authorized and actually transacting that line of business in this state. If fewer than three insurers are authorized and actually transacting the line of business in this state, diligent effort must be met by searching this lesser market.
(B) the appearance on the current approved risk list of the kind of insurance being sought; or
(C) the insurance is natural disaster multiperil insurance; and
(iii) all other requirements of this part are met.
(b) A producing insurance producer is not required to satisfy the search requirements in subsection (2)(a)(ii) if:
(i) the premium rate quoted by an authorized insurer is at least 10% higher than the premium rate quoted by an unauthorized insurer;
(ii) the unauthorized insurer is eligible under 33-2-307; and
(iii) the unauthorized insurer or the surplus lines insurance producer that placed the contract of insurance with the unauthorized insurer has provided the insured with disclosure information in a form and content approved by the commissioner.
(c) A producing insurance producer is not required to satisfy the search requirements in subsection (2)(a)(ii) if:
(i) the insured is an exempt commercial purchaser;
(ii) the producing insurance producer placing the coverage has disclosed to the exempt commercial purchaser that the insurance may or may not be available from an authorized insurer that may provide greater protection with more regulatory oversight; and
(iii) the exempt commercial purchaser has subsequently requested in writing to the producing insurance producer that the coverage be placed with the surplus lines insurer.