Domicile refers to the state that an individual considers their permanent place of residence. It is the place where they intend to return and make their home indefinitely, even if they are not currently living there. While an individual can have more than one residence, they can only have one domicile. The question of domicile can arise in many legal issues, especially taxation, and can have an effect on residency requirements for divorce proceedings.

Residence is frequently used as a synonym for domicile, but it can also refer to the state where an individual is actually living. An individual may become a legal resident of a state for certain purposes without changing their domicile. For example, an individual may qualify as a "legal resident" of a state for purposes of obtaining a divorce if they have lived in that state for at least six months.

In the context of insurance, domicile state is most commonly used to refer to insurance carriers and insurance agencies or business entities, while insurance producers are likely to exclusively concern themselves with resident state information. The state where an insurer is incorporated or organized is considered its domicile state.

A states determination of an individuals domicile is a question of fact, with no single fact being conclusive. Some factors that can indicate an individuals domicile include where they live, vote, register their car, and where their spouse or partner and children live. However, domicile is fundamentally a question of an individuals intent - which state they consider their permanent home.