Which type of insurer is represented when an agent sells insurance for a company without a certificate of authority in that state?

A non-admitted insurer is one that does not have a certificate of authority to operate in a specific state. This means that the insurer has not been licensed by the state's insurance department to sell insurance products within that jurisdiction. When an agent sells insurance from a non-admitted insurer, it typically involves unique or specialized products that may not be available through admitted carriers due to their regulatory constraints.

Non-admitted insurers often cater to higher-risk markets or niche segments where traditional coverage options may be limited. While they are not licensed in the state, they may still operate under specific conditions that allow them to offer coverage. This is different from admitted insurers, which have gone through the necessary regulatory process and are authorized to operate within the state, providing them certain protections and benefits for policyholders, such as a guarantee fund for claims.

Understanding the distinction between these types of insurers is crucial for agents and consumers, as it impacts the regulatory environment, the level of risk involved, and the protections afforded to policyholders.