What is a surplus lines broker?

A surplus lines broker is a licensed professional who places insurance coverage with non-admitted insurers. This is a vital role in the insurance industry, especially for risks that are too high or specialized for standard insurance markets. Non-admitted insurers are those that are not licensed to operate in a particular state but are allowed to provide coverage under specific regulatory provisions, usually because the risk involved is not sufficiently covered by admitted insurers.

Surplus lines brokers are critical for accessing these types of coverage as they have the expertise and licensing required to navigate the complexities of the surplus lines market. They help clients find appropriate insurance for unique, complex, or high-risk situations that cannot be adequately insured through licensed or admitted carriers. This function is particularly important for industries or scenarios that fall outside the typical underwriting guidelines of standard insurers, thereby ensuring that businesses and individuals can still obtain insurance, albeit from non-admitted sources.