What does "surplus lines" insurance refer to in Massachusetts?

Surplus lines insurance in Massachusetts refers to insurance that is not available from licensed insurers in the state. This concept is essential in understanding how the insurance market works, particularly for unique risks or niche markets that standard insurance providers may not cover.

In Massachusetts, when a particular type of insurance cannot be obtained from a licensed insurer—often due to the high risk or the specialized nature of the coverage—such insurance can be purchased through surplus lines insurers. These are typically unlicensed carriers that operate in the excess and surplus lines market and can provide coverage for unique or unusual risks that standard insurers cannot or will not underwrite.

This distinction is critical for consumers and agents alike because it emphasizes the need for an insurance broker who understands surplus lines laws to facilitate the purchase of such coverage while complying with relevant regulations.