State RegulationsGA specificDifficulty 3/5
An insurer that has never been admitted in Georgia solicits and sells a policy to a resident of Savannah, and the policy is delivered in that state. The insurer's status is best described as which of the following?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under the Georgia Insurance Code, an insurer may not transact the business of insurance in this state without a certificate of authority issued by the Insurance Commissioner. By soliciting and delivering a policy without ever being admitted, the insurer has acted as an unauthorized insurer and faces sanctions and regulatory action by the Office of Commissioner of Insurance and Safety Fire; the status follows licensure, not whether paperwork changed hands.
Why the other options are wrong
- A) Issuing a policy does not confer authorized status; authorization comes from the Commissioner's certificate of authority, which this insurer never obtained.
- C) Alien status turns on where the insurer was organized, not on whether it was admitted in Georgia.
- D) An insurer is domestic only if organized under Georgia law; delivery of the policy in Georgia does not change its domicile.
Memory hook
Selling without a certificate of authority means unauthorized, full stop.