A domestic insurer in Louisiana must

• A. Be formed under federal insurance regulations
• B. Be licensed by the state board only
• C. Be a subsidiary of a foreign insurer
• D. Be organized under Louisiana insurance laws

Answer: (D)

Insurers are regulated primarily at the state level, and a domestic insurer is the one that is organized under the laws of the state where it operates. In Louisiana, that means the company must be formed and organized under Louisiana insurance laws and be authorized to transact insurance there. Federal regulation plays a role in certain areas, but it does not govern how the insurer is formed in the state. Licensing by the state insurance department is required, but it depends on having been properly organized under Louisiana law—not on some other arrangement. It is not a condition to be a subsidiary of a foreign insurer, and being organized under Louisiana laws ensures compliance with the Louisiana Insurance Code and state regulation. So the essential requirement is organization under Louisiana insurance laws.