Chapter 2 - Chart B
B: Types of Insurance Companies
Admitted and Authorized Insurance Company – An insurance company must receive a certificate of authority to do business in any given state. Once they have received this certificate, they are said to be admitted and authorized.
Non-admitted and Unauthorized Insurance Company - An insurance company that has not received a certificate of authority, is said to be non-admitted and unauthorized to do business in any given state.
Classification of Insurance Companies by Location:
- Domestic Insurer - an insurance company formed and domiciled under the laws of a particular state.
- Foreign Insurer - an insurance company formed under the laws of the United States or a particular state of the United States.
- Alien Insurer - is an insurance company formed under the laws of a country other than the United States, its districts, territories, commonwealths, possessions and the Panama Canal Zone.
Classification of Insurance Companies by Form of Ownership
- Stock Company - An incorporated insurance company with its capital divided into shares. Stock companies are owned by their stockholders.
- Mutual Company - An incorporated insurance company without permanent stock that is owned by its policyholders.
- Reciprocals – Lloyds of London is an example of a reciprocal. It consists of members, represented by underwriters who place the risk among its members.
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