1.3 License Maintenance: Biennial Renewals, 15-Hour CE & Disciplinary Penalties

1.3 License Maintenance: Biennial Renewals, 15-Hour CE & Disciplinary Penalties

Quick Answer: All New York public adjuster licenses expire on December 31 of even-numbered years (e.g., 2024, 2026, 2028). To renew, adjusters must submit a renewal application, pay the license fee ($50 per year of the term) and the $10 CE filing fee, and complete 15 credit hours of DFS-approved continuing education (CE) during each full biennial period under N.Y. Ins. Law § 2108(r). Under N.Y. Ins. Law § 2110, the Superintendent may refuse to renew, revoke, or suspend a license after notice and hearing, and § 2127 allows a monetary penalty instead. Acting as an adjuster without a license is a misdemeanor under N.Y. Ins. Law § 109(a) and triggers civil penalties of up to $500 per unauthorized transaction under § 2102(g).

The Biennial Licensing Cycle and Expiration Framework

License maintenance in New York requires strict adherence to statutory deadlines. While many insurance producer licenses are tied to the licensee's birth month, public adjuster licenses in New York operate on a uniform calendar cycle:

• Fixed Universal Expiration Date: All New York public adjuster licenses expire on December 31 of even-numbered years (e.g., December 31, 2024; December 31, 2026; December 31, 2028; December 31, 2030).
• Renewal Term: Renewals run for the two calendar years from January 1 of an odd-numbered year to December 31 of the next even-numbered year. For a new applicant, § 2108(j)(1) lets the Superintendent issue a license for more than two years, up to 30 months. DFS charges $50 for a license period of one year or less and $100 for a longer period.
• Renewal Procedures and Fees: Licensees file renewal applications through DFS's NY LINX portal with the renewal fee and the $10 CE filing fee. Under § 2108(j)(2), if the renewal application is filed by December 31, the existing license continues in force until the renewal is issued, or until five days after the Superintendent refuses it and gives notice.

Consequences of Lapsed Licensure

If an adjuster does not file a renewal application by December 31 of an even-numbered year:

• The license expires immediately at midnight on December 31.
• The individual possesses no legal authority to adjust claims, solicit prospective clients, inspect loss locations for compensation, or execute settlement releases starting January 1.
• Conducting adjusting activities on an expired license constitutes unlicensed adjusting under N.Y. Ins. Law § 2102, exposing the individual to criminal misdemeanor charges and civil monetary fines.
• To return, the individual applies for relicensing. DFS waives the exam for an applicant who was licensed as a public adjuster within the last two years. The relicensing applicant must prove the CE that would have been required at renewal and pay the $10 CE filing fee. Someone not licensed within the two years before applying must pass the Series 17-62 exam again.

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The 15-Hour Continuing Education (CE) Requirement

N.Y. Ins. Law § 2108(r) imposes continuing education on resident and non-resident public adjusters.

Key CE Rules Tested on the Examination

1. 15 hours per full biennial period, not 24 hours and not an annual requirement.
2. No rollover: completing 20 hours in one period earns no credit toward the next.
3. Proof of completion is a written certification from the sponsoring organization (§ 2108(r)(5)). An approved course completed once cannot be taken again for credit, so licensees should keep their completion records.

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Names, Assumed Names, and Addresses

• Legal name changes (§ 2102(f)): every licensee must notify the Superintendent upon changing its legal name.
• Assumed names (§ 2102(f)): except for an individual licensee's own legal name, no licensee may use any name in conducting its licensed business that the Superintendent has not previously approved. DFS recommends obtaining name approval before filing a trade name with a county clerk or the Department of State.
• Address, phone, fax, and email changes (11 NYCRR § 25.4): notify the Department within 30 days.

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Disciplinary Grounds and Sanctions under N.Y. Ins. Law § 2110

The Superintendent of Financial Services is granted extensive disciplinary authority under N.Y. Ins. Law § 2110 to enforce high standards of honesty and professional integrity. Under § 2110(a), the Superintendent may refuse to renew, revoke, or suspend a license after notice and hearing. Under § 2127, the Superintendent may impose a monetary penalty in lieu of revocation or suspension.

Statutory Grounds for Disciplinary Action

Disciplinary proceedings may be initiated if the Superintendent determines that the licensee or applicant has:

• Violated Insurance Laws or Regulations (§ 2110(a)(1)): including Regulation 10's 6:00 p.m. to 8:00 a.m. solicitation ban or its compensation agreement rules.
• Material Misrepresentation: Made a material misstatement, omission, or false assertion in the license application or renewal filing.
• Fraudulent or Dishonest Practices: Engaged in fraudulent, coercive, or dishonest business practices, or demonstrated financial irresponsibility in the conduct of business.
• Demonstrated Incompetency or Untrustworthiness: Proven incompetent or untrustworthy to act as an adjuster, thereby endangering the economic interests of policyholders or the public.
• Withholding or Converting Money (§ 2110(a)(5)): improperly withheld, misappropriated, or converted any money or property received in the course of business.
• Criminal Convictions (§ 2110(a)(7)): been convicted of a felony.
• Public-Adjuster-Specific Ground (§ 2110(a)(15)): failed to act on behalf of and in the best interests of the insured, or failed to make the referral and ownership disclosures required by § 2108(s)(2).
• Other Grounds: discipline of a license in another jurisdiction, forgery, improper use of notes on a licensing exam, and failing to comply with child support or state income tax orders.

Reporting Duties

• Report any administrative action taken against the licensee in another jurisdiction, or by another New York agency, within 30 days of final disposition (§ 2110(i)).
• Report any criminal prosecution within 30 days of the initial pretrial hearing date (§ 2110(j)).
• Notify DFS of a change of business or residence address, telephone number, fax number, or email address within 30 days (11 NYCRR § 25.4).

Administrative Due Process and Hearing Rights

Before the Superintendent can formally suspend or revoke a public adjuster license, the licensee is entitled to constitutional and statutory due process:

• Notice of Charges: The DFS must serve formal written notice detailing the specific factual allegations and statutory violations.
• 10-Day Notice Period: Under § 2110(b), the hearing is held not less than 10 days after notice is given to the licensee and every sub-licensee.
• Hearing Procedure: The hearing is conducted before an impartial DFS hearing officer. The licensee has the right to appear with legal counsel, present sworn testimony, submit evidence, subpoena witnesses, and cross-examine DFS investigators.
• Penalty in Lieu of Revocation (§ 2127): In any one proceeding, the Superintendent may order a penalty of up to $500 for each offense and up to $2,500 in the aggregate, instead of revoking or suspending. If the penalty is not paid within 20 days after the order is mailed, the Superintendent may revoke or suspend.
• After Revocation: A person whose license is revoked cannot obtain any license under the Insurance Law for one year (§ 2110(e)). Revocation of a firm's license also terminates the authority of all its sub-licensees.
• Cease and Desist (§ 2405): The Superintendent may also issue cease-and-desist orders against unfair or deceptive practices after notice and hearing.

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Penalties for Unlicensed Adjusting

Operating as a public adjuster in New York without an active license is treated as a serious public harm, subjecting offenders to concurrent criminal and civil liabilities:

Criminal Penalties: N.Y. Ins. Law § 109(a)

Under N.Y. Ins. Law § 109(a), the general penalty statute of the Insurance Law:

• Any person or entity that willfully violates any provision of the Insurance Law for which no other criminal penalty is expressly provided is guilty of a misdemeanor.
• Unlicensed public adjusting is prosecuted in New York criminal courts by local district attorneys or the New York State Attorney General.
• Conviction may result in criminal fines, probation, mandatory restitution to victims, and jail sentences of up to one year under New York Penal Law.

Civil Penalties: N.Y. Ins. Law § 2102(g)

In addition to criminal prosecution, N.Y. Ins. Law § 2102(g) empowers the Superintendent of Financial Services to levy civil monetary sanctions directly:

• The Superintendent may impose a civil monetary penalty not exceeding $500 for each individual unauthorized transaction.
• Every unauthorized claim inspection, estimate preparation, settlement negotiation, and client solicitation is treated as a separate violation subject to an independent $500 penalty.
• Furthermore, the Superintendent may initiate an action in the New York Supreme Court to secure a preliminary or permanent injunction restraining the unlicensed person from continuing unauthorized adjusting operations.

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Summary of License Maintenance and Penalties