The federal Financial Services Modernization Act of 1999 (the Gramm-Leach-Bliley Act) authorized the establishment of a new organization named the National Association of Registered Agents and Brokers (NARAB). The NARAB would have come into existence if less than 29 state and territory insurance regulators did not implement uniform or reciprocal laws for the licensing of nonresident insurance producers by November 2002. The NARAB would have established uniform producer licensing laws and provided a mechanism for multistate licensing of insurance producers, thereby preempting state-unique licensing procedures and qualifications. In an effort to achieve reciprocity and preserve state regulation of producer licensing, the California Insurance Code was amended as necessary to create reciprocal licensing laws (AB 2984, Chapter 203, Statutes of 2002).
The NARAB was avoided as more than 29 states were certified by November 2002 as reciprocal in their licensing of non-resident producers.
The following changes to producer licensing requirements took effect to meet the reciprocal requirements:
- Action Notices,* Endorsements,* Bonds,* and Solicitor Action Notices* may be submitted after the license is issued for a Life-Only Agent, Accident and Health Agent, Property/Casualty Broker-Agent, Personal Lines Broker-Agent, Limited Lines Automobile Insurance Agent, Motor Club Agent and Limited Lines Travel Insurance Agent license. All other license types must continue to submit bonds or action notices prior to the issuance of their licenses.
- A stipulation and agreement form is no longer required for non-resident applicants.
- Non-residents may now be licensed as Surplus Line Brokers and Special Lines' Surplus Line Brokers.
- Non-resident applicants will be issued a license with the same line(s) of authority that he or she holds in the home state.
- A California individual resident licensee who leaves California and wishes to continue to transact insurance as a California non-resident will be issued a non-resident license by notifying the Producer Licensing Bureau of their change of address and provide a certificate of license status within 30 days of changing their legal residency. No additional application or fees will need to be paid. However, if the non-resident applicant informs the CDI of this change of address after 30 days, the non-resident applicant will be required to complete a new application and pay the applicable non-resident fees.
- The restrictions on types of organizations that may be licensed as a business entity have been eliminated. Any legal entity, other than an individual, may qualify for a business entity license.
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If you need further assistance, please call the CDI's Producer Licensing Bureau at (800) 967-9331, or send an e-mail to the Producer Licensing Bureau. Please be sure to include your name, telephone number, license number and e-mail address in all correspondence with the CDI.