Idaho Life Producer Practice Exam

An unauthorized insurer may place insurance business in Idaho through which type of agent?

1. Direct writer agent

2. Surplus lines agent

3. Captive agent

4. Independent agent

The correct answer is: Surplus lines agent

The correct answer is that an unauthorized insurer may place insurance business in Idaho through a surplus lines agent. Surplus lines agents are specifically licensed to place insurance coverage with non-admitted or unauthorized insurers when that coverage is not available from licensed insurers in the state. This role is important because it provides policyholders with access to unique or specialized insurance solutions that may not be offered by traditional insurers. In Idaho, as in many other states, surplus lines agents are tasked with ensuring compliance with local regulations regarding the placement of these types of risks. They are required to conduct due diligence, showing that the coverage cannot be obtained from any authorized insurers before placing it with an unauthorized one. This regulatory framework is designed to protect consumers while allowing them access to necessary insurance options. In contrast, the other types of agents listed—direct writer, captive, and independent—are usually associated with insurers that are authorized to do business within the state, thus they do not engage in placing business with unauthorized insurers.