What is a surplus lines licensee?

A surplus lines licensee is specifically a professional who is licensed to place surplus lines insurance with nonadmitted insurers. Surplus lines insurance is necessary when the coverage needed is not available from licensed insurers in the state, often because the risk is unusual or higher than what standard insurers are willing to underwrite. The role of the surplus lines licensee is critical in providing access to these products, ensuring that clients can get the specialized coverage they need from markets that are not regulated in the same way as admitted insurers.

This distinction is important because it highlights the unique position of surplus lines in the insurance market, serving clients who would otherwise be unable to secure adequate insurance for particular risks. Nonadmitted insurers often have more flexibility in underwriting which can lead to tailored coverage options for clients with specialized needs. In contrast, the other choices do not accurately describe the responsibilities or scope of a surplus lines licensee, as they pertain to different roles within the insurance industry.