Admitted Company
Definition
An Admitted Company is an insurance company that has been officially licensed and authorized by a state’s insurance department to conduct business within that state. This licensure means the company complies with all the state’s necessary solvency requirements and consumer protection laws.
Key Aspects
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Licensure and Regulation: Admitted insurance carriers are strictly regulated and must follow state laws. They must prove financial stability and comply with specific standards set by the state’s insurance department.
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Consumer Protection: Consumer-based benefits include access to a state guarantee fund. In the event of the inability of an insurance company to fulfill its obligations, this fund ensures policyholders are protected and claims are still paid out.
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Operation Jurisdiction: Despite possibly being domiciled in a different state or country, an admitted company can do business in any state which grants it a license. The company needs to comply with local regulations and usually requires a separate license for each state.
Geographical Implication
An admitted insurance company that operates in multiple jurisdictions must adhere to the insurance regulations of each state, which ensures a uniform level of protection and solvency across different states.
References
- National Association of Insurance Commissioners (NAIC) guidelines - NAIC
- State Government Websites corresponding to the state’s insurance board for specific localized licensing information.
