What does the term 'Admitted Insurer' refer to?

The term 'Admitted Insurer' refers to an insurance company that is licensed to do business within a particular state, such as Florida. This licensing status means that the insurer has met the necessary regulatory requirements and financial standards set forth by the state’s insurance department. Being an admitted insurer provides various advantages, including access to the state's guaranty fund, which can offer protection to policyholders in case the insurer becomes insolvent.

In contrast, non-admitted insurers are those that have not received such licensing and may not be protected by the state's guaranty fund. They might offer coverage options that are not available from admitted insurers but come with higher risks, as policyholders may have limited recourse if these companies become unable to fulfill their policy obligations.

Therefore, being licensed to conduct business directly relates to the term 'Admitted Insurer,' confirming that option B is the correct choice.