The Department of Banking and Insurance has issued Order No. A25-02, granting member insurers of the New Jersey Property-Liability Insurance Guaranty Association permission to impose a surcharge on policyholders to recoup the 2025 assessment.
This order follows NJPLIGA Bulletin 2025-003, which notified member insurers of a 0.3% assessment on net direct written premiums for applicable property/casualty lines. The assessment is due by Monday, Sept. 15, 2025, and applies to policies governed by N.J.S.A. 17:30A-1 to -20. These include most lines of insurance, excluding life, health, workers’ compensation, title, annuities, surety, credit, mortgage guaranty, municipal bond, fidelity, investment return assurance, ocean marine and pet health insurance.
Key details for independent agents
Surcharge authorization. Member insurers that have paid the 2025 assessment may impose a surcharge of up to 0.3% on policies issued or renewed on or after Wednesday, Oct. 1, 2025.
Offset provision. If an insurer has over-recouped past assessments previously, those excess funds must be used as an offset before imposing the new surcharge.
Compliance requirements. Insurers must follow the administrative rules outlined in N.J.A.C. 11:1-6 when implementing the surcharge.
Cap on recoupment. The surcharge must cease once the full amount of the 2025 assessment has been recouped. Any excess funds must be held separately and may only be used with explicit authorization from the DOBI commissioner.
Why it matters to agents
Agents should be aware of this surcharge as it may affect premium calculations and client communications. While the surcharge is modest, transparency with policyholders is essential.
This recoupment mechanism ensures the financial stability of NJPLIGA, which plays a critical role in protecting policyholders from losses due to insurer insolvencies. Agents are encouraged to stay informed and help clients understand the purpose and scope of the surcharge.
Bradford J. Lachut, Esq.
Bradford J. Lachut, Esq., joined PIA as government affairs counsel for the Government & Industry Affairs Department in 2012 and then, after a four-month leave, he returned to the association in 2018 as director of government & industry affairs responsible for all legal, government relations and insurance industry liaison programs for the five state associations. Prior to PIA, Brad worked as an attorney for Steven J. Baum PC, in Amherst, and as an associate attorney for the law office of James Morris in Buffalo. He also spent time serving as senior manager of government affairs as the Buffalo Niagara Partnership, a chamber of commerce serving the Buffalo, N.Y., region, his hometown. He received his juris doctorate from Buffalo Law School and his Bachelor of Science degree in Government and Politics from Utica College, Utica, N.Y. Brad is an active Mason and Shriner.
