🚀 go-pugleaf

Brian Joseph Starr writes:

>Hi, I'm trying to get auto insurance (liability), and I've had a few offers
>which were quite low, but they were from "non-admitted" companies.  What does
>that mean, exactly, and would it be a waste of money to get insurance from them?

from the ca.driving FAQ:

 6.Do insurance companies have to be licensed in CA?  How can I tell if one is?

   From: ostubble@agsm.ucla.edu (Otha Stubblefield III) on Oct 24 1992:

   Today's Los Angeles Times (10/23/92) carries an article on unlicensed
   insurers in its business section on page D1.  This article does not apply
   solely to car insurance.  Summary:

   The unlicensed insurance business is booming in California, with sales
   increasing by a factor of 30 since 1988.  However, complaints have also
   increased by a factor of 100.  Many consumers are finding that they have
   been paying claims to nothing more than a PO Box operation, and it is almost
   impossible to have a claim processed, especially if the company has
   surreptitiously folded.  Insurers using state-licensed agencies are
   protected from insolvency by a fund.  Also, the state has no power over
   unlicensed companies, that are often found to be based outside of the U.S.
   State law prohibits unlicensed insurers from selling in the state, unless
   the policyholder cannot find similar coverage from a licensed carrier.  Only
   certain brokers (surplus-line carriers) are authorized by the state to sell
   out-of-state policies, and that those brokers should be checking these
   companies solvency.  The State does acknowledge, though, that some people
   are not checking due to negligence or that they just don't care.  You can
   find out if a certain carrier is ok by calling the Ca Insurance Consumer
   line at 800-927-HELP.

   End Summary:

   The article does not mention the penalties for using one of these companies,
   namely suspension of your license if you are found to be using one for the
   financial responsibility requirement (liability insurance).  The state and
   DMV will consider you uninsured for the period that you were using them.
   They also do not mention that a companies' status (licensed to unlicensed)
   may change without notification to the consumer.

Followups to ca.driving, please.

to accept the universal responsibility of doing | David L. Levine
good to all sentient beings, and if that is not | Internet: levine@ics.uci.edu
possible, to do no harm                         | UUCP: ...!uunet!ucivax!levine
  -- paraphrased from the Fourteenth Dalai Lama | BITNET: levine@uci