Get Your Auto Insurance License: Steps And Requirements

If you're looking to sell auto insurance, you'll need to obtain a license. The requirements for obtaining a license vary by state, but there are some general steps you'll need to take. First, you'll need to complete a pre-licensing course. This will cover various insurance concepts, definitions, laws, and regulations. Once you've completed the course, you'll need to pass a state licensing exam. After that, you'll need to submit to a fingerprint and background check, and finally, you'll need to submit your license application. The entire process can take a few weeks, so it's important to plan accordingly.

Pre-licensing course

To obtain an auto insurance license, you will need to complete a pre-licensing course. This is a mandatory step before taking the state licensing exam. The pre-licensing course will prepare you with the knowledge and skills needed to pass the exam and become a qualified insurance agent.

The pre-licensing course will cover various topics related to insurance, including ethics and insurance codes, accident and health, life insurance, property and casualty insurance, and personal lines. The duration of the course will depend on the state requirements, with some states mandating a minimum number of hours of pre-licensing education. For example, in California, you need to complete 32 hours of pre-licensing education, including 20 hours focused on general insurance and 12 hours dedicated to ethics training.

When choosing a pre-licensing course, you can opt for either an online or classroom-based course. Online courses offer flexibility and convenience, allowing you to complete the course at your own pace and from the comfort of your home. On the other hand, classroom-based courses provide a structured learning environment and direct interaction with instructors.

It is important to select a reputable and reliable course provider to ensure the quality of the course content and instruction. Some factors to consider when choosing a pre-licensing course include course flexibility, price, and the provider's reputation. Reading reviews and testimonials from previous students can also help you make an informed decision.

Additionally, some states may have specific requirements or exemptions for certain designations or certifications. For example, individuals with specific designations, such as CLU® or LUTCF, may be exempt from pre-licensing education requirements for certain lines of authority. However, they may still need to complete mandatory ethics training.

State exam

To obtain an auto insurance license, you will need to pass a state licensing exam. The specific exam you need to take depends on the type of insurance license you are applying for. For example, to become a property and casualty insurance agent, you will need to pass the Property and Casualty exam. This exam is administered by PSI and has 150 scored questions. Candidates are given 3 hours and 25 minutes to complete the exam.

The Property and Casualty exam is just one example of a state licensing exam for insurance agents. There are many other exams for different types of insurance licenses, such as the Life, Accident & Health (L&H) exam and the Personal Lines Property & Casualty exam. The number of questions on these exams varies, but they are all timed and are usually a series of multiple-choice questions.

The passing grade for state insurance exams varies by state but is usually between 60% and 80%. Some exams, like the Adjuster and Bail Examinations, require a passing score of 70%. It's important to note that if you fail an insurance license examination a certain number of times, you may be prohibited from taking that exam again for a specified period. For example, in California, if you fail an insurance license examination 10 times, you will be prohibited from taking that exam again for 12 months.

To prepare for the state insurance exam, it is highly recommended that you take a pre-licensing course. These courses are offered in both online and classroom settings and provide flexibility to accommodate different learning styles and schedules. When choosing a pre-licensing course, consider factors such as flexibility, price, and the course's reputation. In addition to pre-licensing courses, you can also find exam prep courses specifically designed to help you pass the state insurance exam. These courses offer tools and resources to help you prepare for the exam, such as practice questions and quizzes.

Once you feel prepared, you can register for the state insurance exam. In California, for example, you can register for the exam online or over the phone. You will need to provide a current form of photo identification that matches the name on your exam registration. Arrive at least 30 minutes early to allow time for check-in procedures. If you arrive late, you may not be allowed to take the exam, and you will forfeit your exam fee.

Fingerprinting and background check

In some states, such as California, fingerprinting is required as part of the background checking process for insurance license applicants. This involves submitting fingerprint impressions, which can be done at designated examination sites or test centers. The fingerprints are then scanned against the FBI's Criminal Database to reveal any criminal history. This step helps to identify individuals who may have had run-ins with the law or served prison time, providing an additional layer of security and consumer protection.

The background check process typically includes completing and submitting the "Request for Live Scan Service" form, which collects personal information such as legal name, former names, date of birth, and other details. This form can be obtained from the appropriate examination site or test center. It is important to note that any misdemeanors or felonies may impact the outcome of the licensing process, so it is advisable to review the relevant state guidelines or seek guidance if concerned.

The application fee for the fingerprinting and background check process may vary depending on the location. For example, in California, the total fee is $59 at the Los Angeles examination site, while it is $68.95 at PSI's test centers across the state. These fees generally include the FBI and state-specific processing fees, as well as rolling charges.

It is worth noting that not all states have the same requirements for fingerprinting and background checks. While some states, like Alabama, Alaska, and Arizona, mandate fingerprinting for initial license applications, others, like Arkansas and Delaware, require only identification or a less comprehensive background check process. There are also a small number of states that do not require fingerprinting, background checks, or even multiple forms of identification, leaving consumers more vulnerable to potential fraud or misconduct.

License application

The process of applying for an auto insurance license varies depending on the state. Here is a step-by-step guide on how to apply for an auto insurance license in California and New York.

California

• Complete an Insurance Prelicensing Course: California requires those seeking an insurance license to complete prelicensing before taking the state licensing exam. The prelicensing course covers topics such as ethics, accident and health, life/accident and health, property and casualty, and personal lines. The total prelicensing education requirement is 32 hours, including 20 hours focused on general insurance and 12 hours dedicated to ethics training.
• Pass the California Licensing Exam: After completing the prelicensing course, you must pass the state licensing exam. The exam is administered by PSI, and you can schedule it through their website.
• Get Fingerprinted: You need to submit your fingerprints to verify your identity and fulfill the background check requirements. This can be done at the California Department of Insurance's (CDI) Los Angeles examination site or at any of PSI's 20 test centers across California.
• Apply for the California Insurance License: With the exams and fingerprinting completed, you can submit your license application online through Sircon. Additional documents can be attached directly to the electronic application or submitted to the National Insurance Producer Registry's Attachments Warehouse.
• Plan to Complete Required Insurance Continuing Education (CE) Credits: All insurance producers must adhere to their home state's CE requirements. In California, you will need to complete continuing education every two years to keep your insurance license active.

New York

• Meet the Minimum Requirements: To apply for a license in New York, you must be 18 years of age or older and complete the prelicensing education requirements.
• Pass the New York State Examination: You need to pass the applicable New York State examination within two years of applying for the license.
• Submit the License Application: Submit a completed license application to the Department within two years of passing the exam. You can apply for multiple classes of licenses simultaneously if qualified. The application must be submitted online via NY LINX.
• Pay the Licensing Fee: There is a fee associated with obtaining a license in New York. The payment options include credit card, electronic funds transfer (e-check), or paper check.

License renewal

To renew a license, licensees must receive a renewal notification from CDI via email. This email will include the license number, license term, license type, and any relevant continuing education requirements. The licensee can update their email address using the Sircon.com Change Address Online service. If a licensee does not receive the email notification, they must still renew their license by following the prompts on the Sircon.com Renewal and Reinstatement Service website.

The Sircon.com Renewal and Reinstatement Service is also available to insurance agents, brokers, and adjusters who want to renew their licenses after the expiration date. Additionally, the online renewal service can be used by licensees who were unable to renew their licenses on time because they had not met all the requirements. These licensees can complete the renewal process by paying a 50% late penalty fee.

Late renewals are defined as any renewal where the requirements, including completing the ethics and continuing education hours for California residents, are not met until after the previous license term's expiration date. Late license renewals incur a 50% penalty fee, and licensees must also file new company appointments and/or business entity endorsements or solicitor appointments, if applicable.

In California, insurance licenses need to be renewed every two years. The renewal process includes completing a specified number of continuing education (CE) hours, which will be either 20 or 24 hours depending on the license type. To submit a license renewal application, an online application service provided by the California Department of Insurance must be used.

Frequently asked questions