Admitted Assets

Updated: 11 March 2024

What Does Admitted Assets Mean?

Admitted assets are the financial items the insurance company will reflect in its balance sheet once it has submitted it to the state regulators. These financial items, if they are not already exact figures of money, should be easily convertible to cash.

Because policyholders invest so much in and depend so heavily upon their insurance coverage, regulators are very strict about the financial solvency of insurance companies compared to other types of businesses.

Insuranceopedia Explains Admitted Assets

When an insurance company submits its balance sheet to insurance regulators, it makes sure that it is financially solvent, meaning that it has enough money currently in store and receivable cash in the future to be able to cover the risks that it has insured.

Insurance companies do not follow the generally accepted accounting principles used in most business endeavors. Instead, they adhere to statutory accounting principles that are more exacting about how financially liquid these companies must be.

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