Homeowner Associations » Hard To Place

High Risk Insurance: Frequently Asked Questions


Question: What forms of coverage are considered Surplus Line?

Answer: Generally, any coverage which cannot be obtained from an admitted carrier would be considered Surplus Lines coverage.


Question: What are some of the requirements for a non-admitted carrier to transact business?

Answer: They must retain at least $15 million in capital and surplus to show they can pay claims and are not in imminent danger of becoming insolvent, and they must have transacted business for at least three years prior to the date of binding.


Question: Do non-admitted carriers offer less coverage since they are not licensed to operate?

Answer: No. In the event your non-admitted carrier becomes insolvent, and you file a claim, that claim will not get paid. However, they do offer coverage of the same quality, and although they are not admitted to transact in California, they must still be admitted in at least one state. There are also certain requirements for non-admitted carriers to meet which secures it from becoming insolvent, and the premiums are usually lower. The bottom line is, anyone seeking coverage with a non-admitted carrier should not be discouraged.


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