According to the NRRA, what type of insurance can a state not prohibit a surplus lines broker from placing?

The National Real Estate Regulatory Authority (NRRA) establishes guidelines that offer federal standards regarding surplus lines insurance. Surplus lines insurance refers to coverage that is not available from licensed insurance carriers within a state, allowing brokers to procure insurance from nonadmitted insurers that may specialize in high-risk or unique coverage needs.

When considering the options, the type of insurance that a state cannot prohibit a surplus lines broker from placing is nonadmitted insurance. This is due to the NRRA's intent to enhance the availability of insurance options for consumers, especially when traditional market offerings fall short. Nonadmitted insurers can provide coverage that might be otherwise unavailable within a state, thus ensuring that brokers have the flexibility to meet their clients' specific insurance needs.

Admitted insurance, on the other hand, is offered by carriers that are licensed and regulated by the state, which is not in the purview of surplus lines brokers. Similarly, local insurance refers to coverage provided by insurers operating within particular jurisdictions according to state licensing laws, and alternative risk insurance typically involves methods such as self-insurance or captives that are not classified under surplus lines.