How are insurers categorized based on their operations?

Insurers are primarily categorized based on their operational characteristics, which typically include various factors such as their geographical presence, market strategies, and the nature of the coverage they provide.

Headquarters location offers a significant insight into how an insurer operates, as it often influences the regulatory environment they must comply with, the markets they serve, and their access to various customer bases. Additionally, insurers may be distinguished as domestic (operating within a single state) or foreign (incorporated in one state but operating in others). This geographic categorization is crucial because it impacts the legal and regulatory frameworks governing their operations.

While factors like financial strength can offer insights into an insurer’s ability to meet claims, it doesn’t directly categorize them in the way that geographical location does. Similarly, the number of policies sold or customer reviews, while meaningful in evaluating an insurer's performance or reputation, do not inherently classify them based on operational structure or strategy. Therefore, categorizing insurers by their headquarters location is a fundamental way to understand their operational landscape.