Which of the following is true regarding a non-admitted insurer?

A non-admitted insurer is one that has not obtained a license to operate in a particular state, which allows them to underwrite policies that might not be available from admitted insurers. The correct statement regarding non-admitted insurers is that they are often used for specialty insurance products. These insurers typically fill gaps in the market, providing coverage for unique or high-risk situations that admitted carriers may not be willing to insure.

Non-admitted insurers have more flexibility in underwriting and pricing compared to admitted insurers, allowing them to offer tailored solutions for specific needs such as excess liability, environmental liability, or niche markets. This is particularly valuable in situations where traditional insurance markets do not provide adequate options.

The premise that non-admitted insurers must comply with all state licensing requirements, exclusively through admitted agents, or that they can only operate within strict statutory guidelines is not applicable. In fact, non-admitted insurers are exempt from some of the regulations that apply to admitted insurers specifically because they do not need to be licensed in the same way, which enables them to operate with greater freedom in offering specialized products.