Licensing of Agents, Brokers, Limited Representatives and Adjusters
Business entity
a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity -does NOT include a sole proprietorship
Limited lines agent
a person authorized by the Commissioner to sell, solicit or negotiate limited lines insurance
Insurance producer
a person required to be licensed to sell, solicit, or negotiate insurance. insurance producer includes an agent, broker, and limited representative
Uniform application
current version of the NAIC Uniform Application for resident and nonresident agent licensing
Ethical standards
when in contact with the public, agents, limited representatives, brokers, adjusters, appraisers, or other insurers representatives are required to do the following: -Promptly identify themselves and their occupation -Carry the license issued by the Department of insurance while performing their duties and display it upon request to any claimant -conduct themselves in such a manner as to inspire confidence by fair and honorable dealings It is illegal for a claims management person, agent, etc. to do any of the following: -accept any tips from any provider of services for recommending that provider to claimants -purchase salvage from a claimant -intimidate or discourage any claimant from seeking legal advice by withdrawaling and reducing a settlement offer previously tendered or threatening to do so if the claimant seeks legal advice. adjusters cannot advise or recommend any legal counsel to any claimant under any circumstances -cause any undue delay in the settlement of a property damage claim on account of the claimant's choice of a motor vehicle repair service
license
-a document issued by the Commissioner authorizing a person to act as an insurnce agent
Agent
-a person licensed to solicit applications for, or to negotiate a policy of insurance. -A person NOT duly licensed who solicits or negotiates a policy of insurance on behalf of an insurer is an agent and becomes liable for all the duties, requirements, liabilities and penalties to which an agent of such company is subject. -An agent represents the insurer and not the insured or their beneficiary
Broker
-a person who, being a licensed agent, procures insurance for a party other than himself through a duly authorized agent of an insurer that is licensed to do business in NC but for which the broker is not authorized to act as agent. -a broker represents the insured or his beneficiary and not the insurer
limited lines for rental car companies
-a producer licensed in limited lines for rental car companies means the producer is only authorized to sell certain coverages relating to the rental of motor vehicles -example, the Commissioner may issue a limited license to a car company -the rental car company may act as an agent for an authorized insurer only in connection with the rental of vehicles and only with respect to the following kinds of insurance: -excess liability insurance that provides coverage to the rental car company and renters and other authorized drivers, in excess of the standard liability limits provided by the rental company in its rental agreement, for liability arising from the negligent operation of the rental vehicle -accident and health insurance that provides coverage to renters and other vehicle occupants for accidental death or dismemberment and for medical expenses resulting from an accident that occurs during the rental period -personal effects insurance that provides coverage to renters and other vehicle occupants for the loss of, or damage to, personal effects that occurs during the rental period -any other coverage that the Commissioner may approve as meaningful and appropriate in connection with the rental of vehicles Insurance can only be issued under the following conditions: -the rental period of the rental agreement does no exceed 30 consecutive days -at every rental car location where rental car agreements are executed, brochures or other written materials are readily available to the prospective renter that comply with the following requirements
Restricted license for overseas military agent
-an individual may transact insurance under a restricted license as a foreign military sales agent representing a life insurance company in NC, provided that the agent represents the insurance company only in a foreign country or territory and either on a US military installation or with USmilitary personnel -a restricted license can be renewed annually
Appointment of agents
-an insurer can appoint any agent in this state -when insurer appoints a new agent, insurer must file a notice of appointment with the commissioner within 15 days after the date the first insurance application is submited -if an insurer terminates the licensee's appointment, employment, or contract, the agent must notify the commissioner within 30 days
Adjuster
-any individual who, for salary, fee, or commission, investigates or reports to his principal relative to claims arising under insurance contracts other than life or annuity -an attorney at law who adjusts insurance losses from time to time incidental to the practice of his profession or an adjuster of marine losses is not deemed to be an adjuster
Acting without a license
-any person who pretends to be a principal, agent, broker, limited representative, adjuster, or motor vehicle appraiser without a license will be guilty of a class 1 misdemeanor
acting without a license
-class 1 misdemeanor
Change of address and notification of criminal convictions
-if a licensee changes address they must notify commissioner within 10 business days after the move -if a licensee is convicted in any court for any crime other than a motor vehicle infraction, they must notify the commissioner within 10 days after date of conviction
Prelicensing education and examination requirements
-individuals applying for a single-line license, such as life, accident and health or sickness, property, casualty, or personal lines must first complete 20 hours of prelicensing education -each resident applicant for a medicare supplement and long term care insurance license must complete 10 hours of instructure -after completion and filing of the application, each applicant for license must pass an examination -if a licensee has been found guilty of any violation of any provision, they may have to pass a written examination
Suspension, probation, revocation, or nonrenewal of licenses
-many reasons the commissioner can suspend, probation, or nonrenew a license -any person responsible for notifying the commissioner must provide the notice within 3 business days after the commencement of the proceeding or the making of the assignment The following are the NC regulations that apply to license-related notifications by the commissioner and to the commissioner: -any licensee who decides to terminate his or her residency in this state must deliver the insurance license to the commissioner personally or by mail within 30 days after terminating residency -the commissioner may issue a duplicate license for any lost, stolen or destroyed licensed once the licensee submits a written request and pays required fees
Home state
-means NC and any state or territory of the US in which an insurance agent maintains his or her principal place of residence or principal place of business and is licensed to act as an insurance agent
Application for license
-person applying for a resident insurance agent license must make application to the commissioner on the uniform application Applicant must meet the following requirements: -at least 18 years of age -has no committed any act that is ground for probation, suspension, nonrenewal, or revocation -has satisfied any application requirements -paid fees -pass examinations
Resident and nonresident license
-resident is a person who lives in NC or any county outside this state that borders NC -any license issued to an applicant claiming residency in NC will be void if the licensee holds a resident license in any other state -a nonresident producer is an individual who is domiciled and licensed as a resident producer in a state other than NC -a person who is not a resident of this state may receive a nonresident producer license if he or she meets the following qualifications: -is currently licensed as a resident and is in good standing in his or her home state -has submitted the request for licensure in the form prescribed by the Commissioner and has paid the applicable fees -has submitted or transmitted to the Commissioner a copy of the application for licensure that the person submitted to that person's home state -lives in a home state that awards insurance producer licenses to residents of this state on the same basis
Agents liability
-unlawful solicitation, negotiation, or transaction of insurance with an unauthorized insurance company in NC is a class 1 misdemeanor if the individual did not know that the insurer was unauthorized -it is a class H felony if the individual should have known that the insurer was unauthorized
Assumed name
-when an insurance producer conducts business under any name other than the producers legal name, they must notify the commissioner before using the assumed name
Requirements for brokers
Bond- to receive a broker's license, the applicant must file a bond with the commissioner for at least $15,000, or in lieu of a bond, deposit with the commissioner the equivalent amount in cash -a bond cannot be terminated unless at least 30 days prior written notice is given by the surety to the licensee and the commissioner -if a brokers license is terminated, the commissioner must notify the surety within 10 business days -denial of license: if commissioner denies to issue the license, the applicant can make a written appeal for a review within 30 days after notification -if the applicant still disagrees with outcome, they may appeal for a hearing within 30 days
Temporary license
Commissioner may issue a temporary insurance agent license for a maximum period of 180 days (or longer for good cause) without requiring an examination if the commissioner deems that the temporary license is necessary for the servicing of an insurance business in any of the following cases: -to the spouse or surviving spouse or court-appointed personal representative or guardian of a licensed insurance agent who dies or becomes mentally or physically disabled to allow adequate time for the transfer of the insurance business owned by the agent, for the recovery or return of the agent to the business, or for the training and licensing of new personnel to operate the agent's business -to a member or employee of a business entity licensed as an insurance agent, upon the death or disability of an individual designated in the business entity application or the license -to the designee of a licensed insurance agent entering active service in any of the US Armed Forces -in any other circumstance that the Commissioner deems that the public interest will be served best by the issuance of that license
Maintaining a license
Continuing education- each person who holds an insurance license in NC must complete 24 hours of continuing education every 2 years. Three of these hours must be completed on the subject of ethics. There is no maximum number of carryover credit hours to apply to the next period -Agents who hold an adjusters, property, or personal lines license must also complete 3 credit hours of an approved Flood course every other compliance period in addition to the ethics requirement -the licensees are required to complete continuing education by the last day of the licensee's birth month in the compliance year -licensees must maintain a record of completed CE hours for at least 5 years, which will be available for inspection -only a licensed insurable producer who is unable to comply with CE requirements due to military service or long term medical disability may request a waiver for CE requirements. They must submit deployment orders from the US department of defense or a notarized statement from a licensed physician -Licensees granted exemption prior to Oct 1, 2010 would continue to be exempt from CE requirements if they are age 65 or older, has been continuously licensed in the line of insurance for at least 25 years, or holds a professional designation or certifies to the commissioner annually that he or she is an inactive agent
General license requirements
No person can act as an agent, broker, limited representative, adjuster, or motor vehicle damage appraiser without being properly licensed. An agent or broker may be licensed for any of the following lines of authority: -Life: coverage on human lives, dismemberment by accident and benefits for disability income -Accident and Health or Sickness -Variable life and Variable Annuity -Medicare supplement and long term care -property -Casualty -Personal lines -Limited line insurance A limited representatives may receive qualification for one or more licenses without examination for the following kinds of insurance: -Dental services -Limited line credit insurance -motor club -prearrangement insurance -travel accident and baggage -vehicle service agreements and mechanical breakdown insurance A business entity that sells, negotiates, or solicits insurance must be licensed
Licensing fees:
The following table indicates the annual fees that are required to be paid each year before April 1 for the respective licenses issued, renewed, or cancelled: -Adjuster $75 -Adjuster, crop hail only $20 -Agent appointment cancellation- $10 -Agent appointment- individual $10 -Agent appointment, medicare supplement and long-term- individual $10 -Agent- overseas military -Broker- nonresident $50 -Broker- resident $50 -Broker- entity $100 -Limited representative $20 -Limited representative cancellation $10 -Motor vehicle damage appraiser $75 -Surplus lines licensee- corporate $100 -Surplus lines licensee- individual $50
