Are excess and surplus lines insurers safe?

Excess and surplus lines insurers are safe in the sense that they are regulated by the state insurance departments in which they operate and are required to follow certain financial and operational guidelines. However, because excess and surplus lines insurers are not licensed to sell insurance in all states and do not have to follow the same regulations as traditional insurers, there may be some additional risk involved in buying a policy from an excess and surplus lines insurer.

It’s important to do your due diligence and research the financial stability and reputation of any excess and surplus lines insurer you consider buying a policy from. You can check the ratings of excess and surplus lines insurers through independent rating agencies such as A.M. Best and Standard & Poor’s. It’s also a good idea to get quotes from multiple excess and surplus lines insurers to compare the coverage and premiums being offered.