What are some common types of risks that may fall under surplus lines insurance?

Surplus lines insurance is designed to cover risks that are not typically available in the standard market due to their unique or high-risk nature. Option B identifies a range of scenarios that often require this type of coverage, including high-risk businesses, event cancellations, and specialty products. High-risk businesses, such as those in certain sectors like construction or pharmaceuticals, may face challenges securing coverage through standard insurers due to perceived risks associated with their operations. Event cancellations can be unpredictable and can have significant financial implications, making them a prime candidate for surplus lines coverage. Additionally, specialty products, which may include unique or customized items that don’t fit the mold of traditional insurance policies, also fall under this category because they require tailored coverage solutions.

In contrast, the other choices either include risks that are typically covered by standard insurance (like auto-related risks) or suggest risks that may not accurately reflect the purpose of surplus lines coverage, such as limited financial losses due to natural disasters or fraud. Overall, the nature of surplus lines insurance is to address the coverage gaps for high-risk or unique situations that standard insurance providers cannot accommodate.