Which statement about excess and surplus lines insurance is false?

The statement that the customer does not trust any admitted insurer is misleading and is the false one among the options presented. In the context of excess and surplus lines insurance, it is not necessarily about a lack of trust in admitted insurers, but rather about the specific nature of the risk involved. Excess and surplus lines are typically used for risks that admitted insurers are unwilling or unable to insure due to their unique characteristics or the higher risk they pose.

The primary purpose of excess and surplus lines is to provide coverage for specialized or high-risk situations where a standard market policy does not suffice. Customers may turn to these lines not out of distrust but due to a necessity for coverage that admitted insurers cannot provide. Therefore, the notion that a customer must not trust any admitted insurer does not accurately reflect the common motivations behind choosing excess and surplus lines.

Furthermore, the other statements accurately align with the principles governing excess and surplus lines insurance. For example, writing coverage in this category is generally not done simply to secure better pricing but is often based on an unmet need in the insurance market. Additionally, these policies indeed must be obtained through a licensed excess and surplus lines broker, and a diligent search is usually conducted to ensure no authorized carrier is available to cover the risk before proceeding with these