Foreign Insurer

What Does Foreign Insurer Mean?

A foreign insurer is an insurance company based in one state that issues policies to clients in other states. Although foreign insurers are common in the health insurance sector, many U.S. insurers are limited to operating within a single state due to regulatory restrictions known as “state lines.”

Insuranceopedia Explains Foreign Insurer

Insurance companies often become foreign insurers to expand their market reach and attract more clients. However, insurers operating as foreign insurers face additional challenges, as they must compete with local insurers in other states.

Many policyholders prefer foreign insurers because they may offer policies with more favorable terms than those available from in-state insurers. Having the option to buy policies from foreign insurers provides policyholders with greater choice and flexibility.