Insurance procured from an unauthorized insurer is called?

The term that refers to insurance procured from an unauthorized insurer is "surplus lines insurance." This type of insurance comes into play when coverage is sought for risks that the standard market insurers are unwilling to underwrite. In such scenarios, licensed surplus lines brokers can procure insurance from non-admitted carriers—insurers that are not licensed to operate in the particular state but are permitted to provide coverage for specific types of risks not adequately covered by admitted insurers.

Surplus lines insurance plays a critical role in the insurance marketplace, allowing policyholders to obtain coverage when traditional options are limited or nonexistent. For this reason, it is important to ensure that those procuring such insurance work with knowledgeable surplus lines professionals who can navigate the necessary regulations governing this type of insurance.

The other terms—while they might describe situations pertaining to unauthorized coverage—do not accurately define the process or the type of policy derived from it. "Credit insurance" generally refers to a type of insurance that provides coverage against losses due to a debtor's failure to make required payments, while "illegal" and "unauthorized insurance" don't capture the specific legal provisions that allow for procurement from out-of-state or non-admitted companies in a manner that is acceptable given certain regulatory frameworks.