For what reason can insurance only be placed with a non-admitted insurer?

Insurance can only be placed with a non-admitted insurer when it cannot be placed through an authorized carrier. In situations where coverage is needed but traditional insurance providers (those that are licensed and authorized to operate in a particular state) are unable to provide a viable option—often due to the risks involved or because the type of coverage is not offered—non-admitted insurers become a necessary alternative.

Non-admitted insurers are often used for specialized or high-risk types of insurance that may not fit the standard underwriting criteria of authorized carriers. This practice is a vital part of the surplus lines market, which exists specifically to fill these gaps in coverage. Agents and brokers must follow certain guidelines when placing insurance with non-admitted insurers, including ensuring that they have made an adequate effort to obtain coverage from admitted carriers first.