An alien insurer is defined as

• A. is an insurer operating in the U.S. but headquartered outside the US
• B. is based in the U.S.
• C. an insurer that only sells to aliens
• D. an insurer that operates exclusively outside the U.S.

Answer: (D)

An alien insurer is an insurer organized under the laws of a country other than the United States. This distinguishes it from a domestic insurer (incorporated in the same state) and a foreign insurer (incorporated in another state within the U.S.). The defining factor is the country of incorporation. The option that describes an insurer operating exclusively outside the U.S. best matches this concept because it emphasizes being outside U.S. jurisdiction. Note that some alien insurers may still transact business in the U.S. with proper regulatory approval, but their classification hinges on their country of incorporation.