What term describes insurers that are not licensed in the state they operate in?

The term that describes insurers that are not licensed in the state they operate in is "unauthorized insurers." These companies have not received the necessary approval or license from a state's insurance department to conduct business in that state. As a result, they do not meet the regulatory requirements established by state law, which are designed to protect consumers and ensure that insurance companies are financially stable and able to meet their obligations.

In contrast, authorized insurers are licensed and approved to operate within a particular state, while admitted insurers refer specifically to those that have been granted permission to do business by a state's regulatory authority. Foreign insurers are those that are licensed in one state but operate in another, highlighting that these companies do have authorization, albeit in a different jurisdiction.

Understanding the distinction between these terms is crucial for recognizing how insurance regulation functions across different states and the varying levels of consumer protection provided.