West Virginia Property and Casualty Licensing Practice Exam

An insurance company headquartered in Ohio conducting business with West Virginia is known as what?

1. Domestic insurer

2. Foreign insurer

3. Alien insurer

4. Surplus lines insurer

The correct answer is: Foreign insurer

An insurance company that is headquartered in one state and conducts business in another is referred to as a foreign insurer. In this case, since the insurer is based in Ohio but is providing insurance services in West Virginia, it is operating as a foreign insurer in that state. This terminology is used to distinguish between the type of insurer based on the location of their incorporation or headquarters versus the states where they are authorized to operate. The term "domestic insurer" applies only to companies that are incorporated in the state where they are conducting business. An "alien insurer" refers to an insurance company that is incorporated in another country rather than a different state. "Surplus lines insurer" pertains to companies that provide coverage for risks that are not available from standard insurers, often used for unique or high-risk situations.