Key Takeaways
- Producers must complete PRE-LICENSING EDUCATION (typically 20-40 hours), pass a state exam, and submit to a background check before being licensed
- CONTINUING EDUCATION is required to maintain a license—typically 24 hours every 2 years, including 3-4 hours of ethics
- RESIDENT license is issued by the producer's home state; NON-RESIDENT licenses allow selling in other states through reciprocity
- TEMPORARY licenses may be issued for 90-180 days when a licensed producer dies or becomes disabled—to service existing business only
- Failure to complete continuing education results in license TERMINATION or NON-RENEWAL (not suspension)
Last updated: December 2025
Producer Licensing
Licensing Requirements
To sell insurance, producers must be licensed in each state where they conduct business. The licensing process includes:
Pre-Licensing Requirements
| Requirement | Details |
|---|---|
| Pre-licensing Education | 20-40 hours (varies by state and line of authority) |
| State Exam | Computer-based, 100-150 questions, 70% passing score typical |
| Background Check | Criminal history, fingerprints, regulatory actions |
| Application Fee | $50-$200 (varies by state) |
Lines of Authority
| Line | Coverage Types |
|---|---|
| Property | Buildings, contents, fire, theft |
| Casualty | Liability, auto, workers' comp |
| Property & Casualty | Combined line (most common) |
| Personal Lines | Personal auto, homeowners |
| Surplus Lines | Non-admitted insurers |
License Types
Resident License
- Issued by producer's home state (principal place of business)
- Required before obtaining non-resident licenses
- Subject to all state licensing requirements
Non-Resident License
- Allows selling in states other than home state
- Obtained through reciprocity with home state license
- No additional exam required if home state licensed
- Must meet same character and fitness standards
Exam Key: Obtain resident license FIRST, then apply for non-resident licenses in other states through reciprocity.
Continuing Education
Typical Requirements
| Element | Typical Requirement |
|---|---|
| Hours | 24 hours per 2-year cycle |
| Ethics | 3-4 hours included in total |
| Deadline | Before license renewal date |
| Reporting | Automatic through approved providers |
Consequences of Non-Completion
- License TERMINATES or is NOT RENEWED
- NOT a suspension (different from disciplinary action)
- Must reapply and possibly retake exam
Temporary Licenses
When Issued
Temporary licenses may be granted when a licensed producer:
- Dies
- Becomes disabled
- Is called to active military duty
Limitations
| Feature | Details |
|---|---|
| Duration | 90-180 days (state specific) |
| Who Receives | Surviving spouse, business partner, designated employee |
| Scope | Service existing business only |
| New Business | Generally CANNOT solicit new business |
License Maintenance
Required Actions
- Complete continuing education before renewal
- Pay renewal fees
- Maintain active appointment with insurer
- Report address changes (typically within 30 days)
- Report criminal convictions
- Report administrative actions in other states
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Test Your Knowledge
A producer fails to complete their continuing education by the renewal deadline. What happens to their license?
A
B
C
D
Test Your Knowledge
Which license must a producer obtain FIRST before applying for non-resident licenses?
A
B
C
D
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12.2 Producer Authority and Responsibilities
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