Kansas Surplus Lines Tax: Rate, March 1 Deadline, and Penalties

The Kansas surplus lines tax is 3% of gross premiums, charged on coverage placed with non-admitted insurers for insureds whose home state is Kansas. A separate 0.175% SLIP+ transaction fee applies on the same premium base for policies effective on or after May 1, 2026.¹² The broker who placed the coverage owes both charges, and files and pays annually by March 1.

The Rate and the Transaction Fee

Kansas amended K.S.A. 40-246c in 2023 to reduce the surplus lines premium tax from 6% to 3%, effective for the taxable year beginning January 1, 2024. The 3% rate applies to all broker-placed surplus lines policies for insureds whose home state is Kansas.¹

The 0.175% SLIP+ fee is separate from the tax and is collected through the state’s electronic filing platform. It applies to policies with an effective date on or after May 1, 2026, and to endorsements on those policies.²

How the Taxable Premium Is Calculated

Both the 3% tax and the 0.175% fee are calculated on gross premium before any broker commissions are deducted. If part of the premium is returned to the policyholder because of a cancellation or mid-term adjustment, that amount is subtracted from the taxable base.¹

Who Owes the Tax

For coverage placed through a licensed surplus lines broker, the broker is legally responsible for reporting and paying the tax, though the cost is almost always passed through to the insured.

When a Kansas insured buys coverage directly from a non-admitted insurer without a surplus lines broker, the transaction is classified as independently procured insurance. The same 3% rate applies, but the insured reports and remits the tax. The 0.175% SLIP+ fee applies to independently procured policies effective on or after January 1, 2026, and beginning April 1, 2026, independently procured filers must use the SLIP+ platform to report and pay. Previously unreported policies with effective dates between January 1, 2024, and December 31, 2025, should also be reported through SLIP+. Policies effective before January 1, 2024, that were never reported must still be filed directly with the Kansas Department of Insurance through the older filing system.²

Only Kansas Taxes a Kansas-Home-State Policy

Under the federal Nonadmitted and Reinsurance Reform Act, only the insured’s home state can collect the premium tax on a surplus lines policy, even when the risk spans multiple states. Kansas adopted this standard through K.S.A. 40-246i.³

For an individual, the home state is the state of principal residence. For a business, it is the state where the company maintains its principal place of business.⁴ A company headquartered in Kansas with operations in several other states owes the entire surplus lines tax to Kansas, with no need to allocate premium across states or file separately in each one.

March 1 Deadline and SLIP+ Filing

Surplus lines producers file their annual tax report and pay by March 1 each year, covering all surplus lines business transacted during the preceding calendar year. When March 1 falls on a weekend, the deadline moves to the next business day.⁵ The same March 1 date applies to the sworn diligent-search affidavit required of surplus lines brokers.⁶

Kansas adopted SLIP+ for all surplus lines tax reporting and payment beginning April 1, 2026. Brokers enter policy data into the system throughout the year, and SLIP+ generates quarterly invoices for taxes and fees owed. Policies effective on or after January 1, 2026, along with their endorsements, go through SLIP+, and the platform also accepts filings for previously unreported policies dating back to January 1, 2024.²

Each filing requires the policy number, the non-admitted insurer’s name and NAIC number, effective and expiration dates, and a breakdown of premiums and fees. The insurer must appear on Kansas’s list of approved non-admitted surplus lines carriers or on the NAIC Quarterly Listing of Alien Insurers.⁶

Penalties for Late Filing or Payment

Missing the March 1 deadline is expensive. Under K.S.A. 40-246c, the Commissioner of Insurance can assess a penalty of up to double the tax owed against any licensee who fails to file the required affidavit or statement, or who fails to pay the tax on time.¹ On a $100,000 policy, the base 3% tax of $3,000 could become $6,000 in penalties alone.

Persistent non-compliance can also lead to administrative action against the broker’s license. The Kansas Insurance Department has broad authority to suspend or revoke a surplus lines license when a producer repeatedly fails to meet filing or tax obligations.

Coverages That Can’t Be Written Surplus Lines

Some risks can’t be placed in the surplus lines market at all, so the tax question never arises for them. The Kansas Insurance Department has determined that surplus lines brokers cannot write coverage eligible through the FAIR Plan, the Kansas Automobile Insurance Plan, the Kansas Health Care Provider Insurance Availability Plan, or the Workers’ Compensation Insurance Plan, because each is available through admitted carriers. If one of those plans declines the risk in writing, the broker may then approach a surplus lines insurer.⁶

1
Kansas Office of Revisor of Statutes. Kansas Code 40-246c – Excess Coverage License; Accounting of Gross Premiums and Tax Thereon; Penalty
2
SLIP+. Kansas
3
National Association of Insurance Commissioners. Nonadmitted Insurance Reform Sample Bulletin
4
Kansas Office of Revisor of Statutes. Kansas Code 40-246i – Definitions
5
Kansas Department of Insurance. Instructions for Online Surplus Lines Statement and Policy Reporting Form
6
Kansas Department of Insurance. Excess and Surplus Lines