State RegulationsFL specificDifficulty 1/5
An insurance company that was formed under the laws of another U.S. state applies for a license to sell policies in Florida. In Florida insurance terminology, how is this company classified?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under the Florida Insurance Code (Chapter 624, Florida Statutes), a foreign company is an insurer formed under the laws of another state, territory, or district of the United States, as opposed to a domestic company formed in Florida or an alien company formed under the laws of a foreign country.
Why the other options are wrong
- A) An insurer formed under Florida law is a domestic company.
- B) An insurer formed under a foreign nation's laws is an alien company; foreign companies come from sister states.
- C) The classification reflects place of formation, not where the insurer happens to sell.
Memory hook
Foreign = from a sister state.