Which of the following statements is TRUE regarding nonadmitted insurers?

The statement that acting for a nonadmitted insurer is a misdemeanor is accurate. In the context of insurance regulation, nonadmitted insurers are those not licensed to operate in a particular state. Working with these insurers can lead an agent to face legal repercussions for violating state insurance laws.

When an agent engages with a nonadmitted insurer, particularly when they facilitate or promote the sale of insurance products from that insurer, it constitutes a misdemeanor because it goes against regulatory frameworks that ensure consumer protection and financial stability within the insurance market. States have rules in place to safeguard policyholders and regulate insurance practices, thus reinforcing the gravity of acting outside those guidelines.

This understanding highlights the critical nature of compliance within the insurance industry and underscores the importance of working with properly licensed insurers to avoid legal issues.