What is Insurance that is "admitted" by State Insurance Departments?
Insurance that is “admitted” by a state insurance department typically means that the policy coverage has been submitted by the insurance company to the state’s insurance department for review and was deemed to be acceptable; and that the rates and rating plan governing the premium pricing for the coverage has been reviewed and deemed to be reasonable and approved by that state’s insurance department.
Additionally, in most states admitted policies are also typically protected by a state’s Guarantee Fund against the potential insolvency of an insurance company that might prevent it from paying its claims.
This is not generally true of “non-admitted” or “excess & surplus lines” coverage frequently sold by some agents and brokers. Furthermore, most states restrict or prohibit the sale / purchase of “non-admitted” or “excess and surplus lines” insurance coverage where admitted insurance coverage is available.
