Are you being quoted an insurance policy that is non-admitted?  It is important to understand the differences when making a decision to bind coverage. Basically an admitted carrier files and is approved to do business within the state.  They must file rates and policy forms to the state Department of Insurance.  Although Colorado is a file and use state, they eventually must get approval.  They are licensed to do business and are financially guaranteed by the state guaranty fund to which they contribute.   They file taxes annually and can place business directly through retail insurance agents . They are regulated very closely by the state in terms of cancellation, non renewal etc.    Non-admitted carriers are not licensed to do business within the state of Colorado and don’t have to file their rates or forms to the state Department of Insurance.  They can move around pretty freely but can only work through a surplus lines broker or MGA.  The surplus lines broker charges tax directly to the insured and then files those taxes monthly to the state department of insurance. Typically  they are used to place risks that the admitted carriers do not want.  Retail agents are required to  prove that the risk cannot be insured with a licensed carrier prior to placing  business with a non-admitted carrier  Because Non Admitted insurers are willing to insure these more difficult situations they are granted certain exceptions that apply to Licensed insurers. For example they are not required to get approval for the policy forms that they use or the premiums that they charge. They are also exempt from rules concerning the cancellation or non renewal of policies. http://colosla.org/about/faq  Are Non Admitted insurers as financially secure as Licensed insurers? A.M.Best, a nationally ranked rating agency, conducts annual research into the insolvencies of both Licensed and Non Admitted insurers. They have found that insolvencies are less frequent in Non Admitted insurers and that they are financially secure. It is always a wise move to ask your agent for the financial rating of your insurer.