What does the "diligent search" requirement entail?

The "diligent search" requirement emphasizes the broker's obligation to demonstrate that they have exhausted all reasonable means to locate insurance coverage from admitted insurers before turning to non-admitted (surplus lines) insurers. This requirement protects consumers by ensuring that they are offered all available options that meet their needs and comply with regulations.

By requiring the broker to show efforts made in securing coverage from admitted insurers, this provision underscores the idea that surplus lines coverage is intended as a last resort when conventional options are not viable. The diligent search process typically involves documenting outreach to various admitted insurers and providing proof of any rejections or unavailability of coverage.

The other options do not align with the intent of the diligent search requirement. Conducting a search without documentation would not meet professional standards. Attempting to secure coverage only from non-admitted insurers overlooks the primary goal of exhausting all options with admitted insurers first. Focusing solely on finding lower premiums might not address the comprehensive needs of the client regarding coverage adequacy and would fail to fulfill the diligent search obligation.