What is an "affiliated group" in the context of insurance?

In the context of insurance, an "affiliated group" refers to a group of related insureds that are associated through a nonadmitted insurance contract. This is particularly relevant in surplus lines insurance, where policies may be issued to multiple entities that share a common interest or relationship. This group can include members of a parent company, subsidiaries, or entities that have a connection in terms of ownership or operational ties.

This definition highlights the nature of surplus lines, which provides coverage when standard insurance cannot accommodate unique risks faced by these affiliated entities. They can benefit from specialized policies tailored to meet their collective needs, rather than individual policies that may not adequately address their unique risk profiles.

Other options present different concepts in the insurance field but do not capture the specific nature of what constitutes an "affiliated group" in relation to nonadmitted insurance contracts. For example, while option A discusses individual policyholders, it overlooks the collective nature of a group related through nonadmitted policies. Option C introduces a cohesive group of agents, which is focused on distribution rather than insured parties. Option D refers to regulatory networks, which is unrelated to the composition of insurance policies or groups. Thus, the focus on related insureds in option B accurately reflects the essence of an