AB 943: Insurance agents: prelicensing education.

32.

(a) A life and accident and health or sickness licensee is a person authorized to act as a life agent on behalf of a life insurer or a disability insurer to transact any of the following:

(1) Life insurance.

(2) Accident and health or sickness insurance.

(3) Life and accident and health or sickness insurance.

(b) Licenses to act as a life agent under this chapter shall be of the types as set forth in Section 1626.

(c) A life agent may be authorized to transact 24-hour care coverage, as defined in Section 1749.02, pursuant to the requirements of subdivision (b) of Section 1749.33.

1625.55.

(a) A limited lines automobile insurance agent is a person authorized to transact automobile insurance, as defined in Section 660. A limited lines automobile insurance agent license is a license to so act.

(b) A license under this section shall be applied for and renewed, following successful completion of a qualifying examination on this code, ethics, and products sold under the license, in the same manner as provided in this chapter for a license to act as a property broker-agent or a casualty broker-agent.

(c) The commissioner shall require in advance a fee for filing any applications, renewals thereof, or changes in outstanding licenses, or for the filing of other required documents at an amount designated in this chapter for a personal lines licensee, and for filing any notice of appointment or notice of termination at an amount specified in Section 1751.3.

(d) A person licensed as a limited lines automobile insurance agent who makes an application to the commissioner to become a property broker-agent or a casualty broker-agent pursuant to Section 1625 or a personal lines agent pursuant to Section 1625.5 shall do all of the following:

(1) Submit an application on a form provided by the commissioner.

(2) Take and pass a qualifying examination pursuant to Section 1676.

1626.

(a) A life and accident and health or sickness licensee is a person authorized to act as a life and accident and health or sickness agent. Licenses to act as a life and accident and health or sickness agent under this chapter shall be of the following types:

(1) Life, which license shall entitle the licensee to transact insurance coverage on human lives, including benefits of endowment and annuities, and may include benefits in the event of death or dismemberment by accident and benefits for disability income.

(2) Accident and health or sickness, which license shall entitle the licensee to transact insurance coverage for sickness, bodily injury, or accidental death and may include benefits for disability income.

(b) An accident and health or sickness agent licensee is authorized to transact 24-hour care coverage, as defined in Section 1749.02, pursuant to subdivision (d) of Section 1749.33.

1661.

Whenever an organization licensed as a life agent, property broker-agent, casualty broker-agent, personal lines broker-agent, or limited lines automobile insurance agent desires to change, remove, or add to the natural person or persons who are to transact insurance under authority of its license pursuant to Section 1656, it shall immediately file an application or notice on a form prescribed by the commissioner with the commissioner for an endorsement changing its license accordingly. The form shall be submitted by a means of electronic service approved by the commissioner. The commissioner shall require that the qualifying examination provided by this code be taken by any natural person named by the organization to exercise its agency or brokerage powers who would be required to take and pass the qualifying examination. That natural person or persons and the organization are in all other respects subject to the provisions of this chapter and the insurance laws.

1749.

(a) The department shall require all new applicants for license to meet prelicensing education standards as follows:

(1) An applicant for license as a property broker-agent, casualty broker-agent, life agent, accident and health or sickness agent, personal lines broker-agent, or limited lines automobile insurance agent shall be required to complete 12 hours of study on ethics and this code. The 12-hour ethics course shall include one hour of study on insurance fraud. If an applicant seeks a license for more than one of the following license types: property broker-agent license, casualty broker-agent license, life license, accident and health or sickness license, or personal lines broker-agent license, the applicant shall only be required to complete one 12-hour course on ethics and this code, which shall include one hour of study on insurance fraud. The curriculum for satisfying this requirement shall be approved by the curriculum board and submitted to the commissioner for final approval.

(2) An applicant for a property broker-agent license, casualty broker-agent license, life agent license, accident and health or sickness license, personal lines broker-agent license, or limited lines automobile insurance agent license, who is currently licensed as a nonresident in this state shall be required to complete the 12-hour course of study on ethics and this code, as required by this section. The 12-hour ethics course shall include one hour of study on insurance fraud.

(b) Review and approval of prelicensing courses not conducted in a classroom shall include an evaluation of the safeguards in place to ensure that the student completing the course is the person enrolled in the course, methods used to monitor the student’s attendance are adequate, methods for the student to interact with the entity providing the training exist, and methods used to record the times spent completing the course are adequate.

(c) Prelicensing certificates of completion expire three years from the completion date of the course, whether or not a license is issued.

1749.1.

(a) The commissioner shall appoint a curriculum board consisting of representatives of insurance agents, brokers, and life agents trade associations, representatives of insurance companies, consumer groups, bail agents, and independent and public insurance adjusters to develop the license examination and continuing education curriculum, including a list of preapproved courses of study, including courses of study for professional designations that would satisfy the requirements of this article, subdivision (a) of Section 1810.7, and Sections 14090.1 and 15059.1. The curriculum board shall develop or recommend courses of study covering all lines of insurance to be sold under each license, including, but not limited to, any special products such as long-term care insurance, Medi-gap policies, disability insurance products, and course study on ethics and pertinent sections of this code. The curriculum board shall also develop or recommend courses of study on commercial earthquake risk management, including courses relating to understanding risk zones, options for insurance coverage to cover potential loss, mitigation strategies, and postevent recovery. The curriculum developed and the courses of study approved by the board shall be submitted to the commissioner for final approval.

(b) The curriculum board shall also develop standards for providers and instructors of the 12-hour ethics course and continuing education courses, programs, and seminars, which standards shall be approved by the board and submitted to the commissioner for final approval. The curriculum board may approve standards for courses in business management practices that may consist of up to 25 percent of the agent or broker requirements for license renewal. A 12-hour ethics course or continuing education course shall not include sales training, motivational training, self-improvement training, or training offered by insurers or agents regarding new products or programs.

(c) For purposes of applying subdivision (b), courses in “business management practices” shall consist of the following subject matter:

(1) Accounting and financial management, including trust account maintenance, reconciliation and auditing, financial statements, business budgeting, income and expense ratios, banking and investment practices, and business perpetuation and planning.

(2) Information and database management, including recordkeeping, privacy law, and other legal requirements covering the use of information.

(3) Human resource management, including employee compliance supervision, recruitment, training, and licensing.

(4) Customer service management, consisting of methods to improve handling of consumer inquiries and complaints.

(5) Communication skills, consisting of methods to improve writing and verbal skills for communication with clients, employees, insurance carriers, claims departments, and regulators.

(d) Whenever the commissioner has reasonable cause to believe, and determines after public hearing, that any approved course, program of instruction, or seminar is being conducted so as to fail to meet the commissioner’s 12-hour ethics course or continuing education curriculum, or any provider or instructor for any course, program, or seminar has failed to comply with the commissioner’s standards, the commissioner may make and serve upon the provider or instructor of that course, program, or seminar an order or orders rescinding approval for that provider, course, program, or seminar, or imposing fines and penalties on that provider, or both. The amount of any fines and penalties shall not exceed the amounts set forth in Section 1748, and shall be based on the criteria for assessing penalties specified in that section. No credit towards meeting the requirements of this article shall be granted any applicant or licensee for completion of a course, program, or seminar after the effective date of any order rescinding approval for that course, program, or seminar. The commissioner shall serve notice of hearing required by this section upon the provider or instructor of the course, program, or seminar, stating the time and place therefor, and the grounds upon which the commissioner’s order is made. The hearing shall occur not less than 30 nor more than 60 days after notice is served.

(e) The commissioner may impose monetary penalties for minor instances of noncompliance with the standards established pursuant to this article, such as late course roster submissions and late course presentation schedules. The monetary penalties shall not exceed the amounts of the fees established pursuant to Section 1751.1. The commissioner shall adopt regulations to establish the monetary penalties to be levied against providers for late filings and other minor instances of noncompliance with this article and Article 6.5 (commencing with Section 2186) of Subchapter 1 of Chapter 5 of Title 10 of the California Code of Regulations.

1749.33.

(a) A life agent licensee shall satisfactorily complete 24 hours of instruction, of which three hours shall be in ethics, prior to renewal of the license. On and after March 1, 2023, the three-hour ethics course shall include one hour of study on insurance fraud. These hours of instruction may be completed at any time prior to renewal of the license.

(b) An accident and health or sickness agent licensee shall satisfactorily complete 24 hours of instruction, of which three hours shall be in ethics, prior to renewal of the license. On and after March 1, 2023, the three-hour ethics course shall include one hour of study on insurance fraud. These hours of instruction may be completed at any time prior to renewal of the license.

(c) An agent licensed as both a life agent and as an accident and health or sickness agent shall satisfactorily complete a total of 24 hours of instruction, of which three hours shall be in ethics, prior to renewal of the license. On and after March 1, 2023, the three-hour ethics course shall include one hour of study on insurance fraud. These hours of instruction may be completed at any time prior to renewal of the license.

(d) Any accident and health or sickness agent who wishes to sell 24-hour care coverage, as defined in Section 1749.02, shall complete a course, program of instruction, or seminar of an approved continuing education provider on workers’ compensation and general principles of employer liability, which shall be completed by examination approved by the commissioner as part of the continuing education course, program of instruction, or seminar prior to selling this coverage. The required number of instruction hours shall be equal to but no greater than that required by the curriculum board for the continuing education requirements of a property broker-agent or a casualty broker-agent on these subjects. For resident licensees, this requirement shall count toward the licensee’s continuing education requirement, but may still result in completing more than the minimum number of continuing education hours set forth in this section. This section does not authorize an accident and health or sickness agent to satisfy the obligations set forth in this section by other than a proctored examination administered or approved by the department.

1751.1.

(a) The commissioner shall require seventy-five dollars ($75), in advance, as a fee for filing an application for certification as a 12-hour ethics course or continuing education provider pursuant to Section 1749.1. That certification shall be effective for a period of 24 months.

(b) The commissioner shall require seventy-five dollars ($75), in advance, as a fee for filing an application to renew certification as a 12-hour ethics course or continuing education provider pursuant to Section 1749.1. That certification shall be effective for a period of 24 months.

(c) The commissioner shall require seventy-five dollars ($75), in advance, as a fee for filing an application for certification of a 12-hour ethics course pursuant to Section 1749. That certification shall be effective for a period of 24 months.

(d) The commissioner shall require thirty-seven dollars ($37), in advance, as a fee for filing an application to renew certification of a 12-hour ethics course pursuant to Section 1749. That certification shall be effective for a period of 24 months.

(e) The commissioner shall require thirty-seven dollars ($37), in advance, as a fee for filing an application for certification of a continuing education course, program, or seminar pursuant to Section 1749.3 and Section 1749.32. That certification shall be effective for a period of 24 months.

(f) The commissioner shall require fourteen dollars ($14), in advance, as a fee for filing an application to renew certification of a continuing education course, program, or seminar pursuant to Section 1749.3 and Section 1749.32. That certification shall be effective for a period of 24 months.

1757.2.

A limited license shall be applied for and renewed in the same manner as is provided in this chapter for a licensee to act as a property broker-agent or a casualty broker-agent, except that an applicant for a limited license as a cargo shipper’s agent need not pass a qualifying examination and is exempt from the continuing education requirements. The fee for filing an application shall be twenty-nine dollars ($29) for each year or fraction thereof of the term of the license applied for.

1757.2.

A limited cargo shipper’s license shall be applied for and renewed in the same manner as is provided in this chapter for a licensee to act as a property broker-agent or a casualty broker-agent, except that an applicant for a limited license as a cargo shipper’s agent need not pass a qualifying examination and is exempt from the continuing education requirements. The fee for filing an application shall be twenty-nine dollars ($29) for each year or fraction thereof of the term of the license applied for.

12815.

(a) An obligor who is not a seller shall possess a vehicle service contract provider license. A vehicle service contract provider license shall be applied for and maintained, and its holder shall be subject to disciplinary action, as if it were a property broker-agent and casualty broker-agent license, with the following exceptions:

(1) An applicant for a vehicle service contract provider license is exempt from having to satisfy continuing education requirements, and from having to pass a qualifying exam.

(2) The fee to obtain a vehicle service contract provider license shall be four thousand nine hundred thirty-nine dollars ($4,939). The fee to renew a vehicle service contract provider license shall be eight hundred forty-seven dollars ($847).

(b) A service contract administrator shall be licensed as a property broker-agent and casualty broker-agent.