Alabama Property and Casualty Practice Exam

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Ohio Casualty, operating in Indiana, is what type of company in terms of its admission status?

Admitted company
Domestic company
Unauthorized company
Risk retention group

The correct answer is: Admitted company

An admitted company is one that has been granted a license to operate in a specific state by that state's insurance department. Since Ohio Casualty is operating in Indiana, it would need to meet Indiana's regulatory requirements and receive licensing from the Indiana Department of Insurance. If Ohio Casualty is indeed licensed in Indiana, it is classified as an admitted company in that state. This status allows it to sell insurance policies and transact business there under the regulations and safeguards established by Indiana law, which is essential for consumer protection. In contrast, a domestic company is defined as an insurer that is incorporated and operates within a particular state. Meanwhile, an unauthorized company would be one that is not licensed to do business in the state, which would mean it cannot legally underwrite policies there. Lastly, a risk retention group is a specific type of insurance company that provides liability coverage. It is comprised of members with similar risks and operates under different regulatory frameworks. Understanding these distinctions helps clarify why the classification of Ohio Casualty as an admitted company is accurate in the context of its operations in Indiana.