What does non-admitted insurance refer to?

Non-admitted insurance refers to insurance that is provided by an insurer that is not licensed or admitted to operate in a particular state. This type of insurance is typically used to cover unique or high-risk situations that may not be addressed adequately by the licensed market. When a policy is placed with a non-admitted insurer, it is often done through a surplus lines licensee, who is authorized to arrange coverage with these non-admitted companies. This process allows access to specialized coverage that may not be available through conventional carriers.

The option discussing insurance not required to be reported does not accurately capture the characteristics of non-admitted insurance. While some entities do have specific reporting obligations, non-admitted status is more about the licensing of the insurer itself. Similarly, the mention of insurance available only through government agencies misrepresents the essence of non-admitted insurance, which does not necessarily involve government providers. Lastly, stating that such insurance is only available to licensed brokers limits the scope inaccurately; while licensed brokers may facilitate the process, the focus should be on the non-admitted nature of the insurer rather than licensing.