ADMITTED INSURER Meaning and
Definition
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Admitted insurer refers to an insurance company that has been granted permission or license by the regulatory authorities of a particular jurisdiction to transact insurance business within that jurisdiction. In simpler terms, an admitted insurer is an insurance company that has met the requirements set by the governing body of a specific region, allowing them to operate and provide insurance coverage to individuals and businesses within that area.
The process of becoming an admitted insurer typically involves satisfying certain financial, legal, and operational criteria, including demonstrating adequate capitalization, submitting extensive documentation, and adhering to regulatory guidelines. By meeting these requirements and obtaining admission into a jurisdiction, an insurer gains credibility and recognition within the insurance industry.
One of the key advantages of utilizing an admitted insurer is the added protection it offers to policyholders. Admitted insurers are subject to rigorous oversight and regulation, ensuring that they operate in compliance with legal and ethical standards. Additionally, policyholders of admitted insurers may have access to certain benefits, such as state-backed insurance guarantee funds, which provide coverage in the event of an insurer's insolvency.
Conversely, insurers that are not admitted are commonly referred to as non-admitted or surplus lines insurers. These insurers typically provide coverage for risks that are considered high-risk or unconventional and may not meet the criteria for admission into the standard insurance market.
In summary, an admitted insurer is an insurance company that has received official authorization to conduct business within a specific jurisdiction, offering policyholders the assurance of regulatory oversight and compliance.
Etymology of ADMITTED INSURER
The term "admitted insurer" does not have an etymology of its own, as it is a specific term used in the insurance industry. However, we can break down the etymology of the individual words:
1. Admitted: The word "admitted" comes from the Latin word "admittere", which means "to allow entrance" or "to let in". It is derived from the combination of "ad" meaning "to" or "towards" and "mittere" meaning "to send".
2. Insurer: The word "insurer" is derived from the word "insure" which comes from Old French "enseurer" and Latin "securus", meaning "safe" or "secure". It ultimately traces back to "se-" (meaning "apart") and "cura" (meaning "care").
