What does an admitted insurer have that allows it to transact insurance?

An admitted insurer has a Certificate of Authority, which is a critical document issued by state regulatory authorities. This certificate grants the insurer the legal right to operate and sell insurance policies within that state. The Certificate of Authority signifies that the insurer has complied with all necessary state regulations, including financial solvency standards, and has met the state's licensing requirements. This is fundamental for consumer protection and ensures that the insurer is authorized to offer specific insurance products.

Other options, such as a special type of policy or a government contract, do not accurately represent the requirements for an insurer to transact business. A national license is also not relevant, as insurance is regulated at the state level in the United States, not on a national basis. Thus, the Certificate of Authority is essential for an admitted insurer's legitimacy and operation within a specific jurisdiction.