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Admitted vs. Non-Admitted Insurance Company

The Policy - Surplus line insurance policies are sold by "nonadmitted" carriers through licensed "surplus line brokers." Other insurance agents and brokers must go to a licensed surplus line brokerage to access non-admitted carriers. When such companies are on List of Eligible Surplus Line Insurers they are regulated.

Non-Admitted Or Surplus Line - Non-admitted does not mean non-regulated. Nonadmitted
carriers on the LESLI have been reviewed and approved by the State Department of Insurance for surplus line insurance in your state. Non-admitted carriers on the LESLI are actually “admitted” insurance carriers in their state or country of domicile other than your state. Surplus lines have been written by non-admitted carriers since the 1800’s, and generally are used when a risk is unusual, unusually large or when coverage is not available
from carriers licensed in your state.

Solvency Regulations - Non-admitted insurers on the LESLI must demonstrate
to the your State their financial stability, reputation and integrity; maintain a minimum of $15 million in capital and surplus at all times (for the State of California, please refer to your state requirements); have 3 years seasoning (or qualify for an exception); have a valid license to transact insurance in their domicile; file financial information with the Department of Insurance and adhere to specific capitalization, investment and solvency standards established under the your state Insurance Code.

California Law - The California Department of Insurance (CDI) is the official regulatory agency for insurance in California, including the surplus line industry. The Surplus Line Association of California is officially a nonprofit advisory organization, which performs
statutory duties for the CDI. The Association’s recommendations are considered and incorporated into the legally binding decisions of the CDI when appropriate.

California’s LESLI was first issued by the California Department of Insurance (CDI) in 1995. Licensed surplus line brokers are forbidden by law from using non-admitted insurers that are not on the LESLI (with narrow exceptions). Make sure your carrier is on the LESLI!

Non-Admitted Means - Insurance carriers not licensed by your State (also called “surplus line carriers”)
• Carriers on the LESLI (are actually “admitted” insurance carriers, licensed in a state or country of domicile other than your State)
• Carriers that must meet strict surplus line laws and regulations in order to provide insurance to your State businesses and residents
• Carriers regulated by their state or country of domicile, including stringent requirements
regarding reputation and integrity, capitalization and solvency, licensing and business practices

What Is The Surplus Line Association Of California?

• A nonprofit 501(c)(6) organization, the Association has been working with the California Department of Insurance (CDI), since 1937, to maintain a responsive and lawful California surplus line market
• The Association performs statutory duties within the California insurance industry under the direction and supervision of the CDI

What Is The LESLI ?

• The “List of Eligible Surplus Line Insurers”
• Established and regulated by the CDI
• Monitored by The Surplus Line Association of California

Who Regulates Surplus Lines Transactions In California?

• CDI legally regulates transactions
• SLA monitors and advises
• Brokers and agents have strict compliance responsibilities to promote and protect consumer awareness