We’re excited to announce that InsCipher has become an approved software vendor for the Kentucky Department of Insurance. This is exciting news for our business and our clients. We are honored to be a support to those who file Kentucky surplus lines taxes in Kentucky and make this process easier for them.
What Makes Kentucky a Challenging State to File In?
Kentucky’s municipal tax is complicated. Unlike most states, Kentucky requires taxes generated from insurance premiums to be paid directly to the taxing municipality where the risk is located. Currently, there are over 400 municipalities in Kentucky. This makes it difficult for surplus lines brokers to pay KY municipal taxes to the proper taxing jurisdiction.
What is an Approved Kentucky Vendor?
To help insurance businesses accomplish this task, Kentucky Department of Insurance requires insurance companies and brokers that write at least 2,000 policies a year to use a “verified risk location system.” This location system will be used to identify municipality jurisdictions for which to report local government premium taxes (LGPT). Kentucky approved vendors help insurance businesses file KY municipal taxes correctly.
How InsCipher Became an Approved Vendor
To become an approved vendor for Kentucky, our tools needed to accurately geolocate risks. InsCipher went through the official Kentucky Department of Insurance approval process. We demonstrated that our products are able to successfully and consistently return the correct jurisdiction more than 95% of the time.
In other words, InsCipher passed the test and became an approved vendor for Kentucky. As an approved vendor, our Kentucky surplus lines tax calculator is now listed as a “verified risk location system” in the state of Kentucky.
What This Means For Our Clients
Becoming an approved vendor for Kentucky brings added benefits to our clients. Combined with our sophisticated tax rules for Kentucky, users can feel confident in getting accurate surplus lines, surcharge, and local government premium tax calculations. This logic is built into our tax calculator API, making the quote/binding process much easier when writing insurance policies in Kentucky. Our tax calculator API can also accommodate admitted premium tax rate returns as well.
Special thanks to our team at InsCipher for working so hard to make this possible!
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