February 26, 2024 • 40 mins
In this insightful episode of "Up to Speed", host Samantha engages in an enlightening conversation with insurance licensing expert and her mother, Nancy Strickler. With over 25 years of experience, Nancy shares her valuable insights into different types of insurance licenses and their acquisition process. The duo navigates through this complex terrain by drawing upon real-life scenarios, tips for passing the test, post-test procedures, and understanding the importance of honesty and full disclosure.
While touching upon multiple processes including application, fingerprinting, and the actual obtaining of the licenses, the conversation becomes interesting with the anecdote of a felon securing an unrestricted license and achieving success in the insurance field. The inclusion of practical advice on managing multiple licenses, renewal fees and responsibilities make this episode an intricate guide to the world of insurance licensing.
For those considering a career in insurance or those already in the process of obtaining their insurance license, this episode is a treasure-trove of insights and recommendations. It highlights crucial mandates, such as homeowners valuation, flood insurance, and the ethics category every potential agent needs to fulfill. The episode also explores the consequences of not being licensed on time and the importance of getting carrier appointments.
From a first-time 8-hour annuity course to managing continuing education, the complexities of license acquisition and renewal are thoroughly explored. As the conversation progresses, listeners are acquainted with the effects of expired licenses, the possibility of reinstatement, and the repercussions of failing to renew licenses on time. The episode concludes with a discussion on the specific conditions applicable for requesting Continuing Education (CE) exemption.
This comprehensive guide is a must-listen for new and seasoned insurance agents alike, shedding light on the nuanced world of insurance licensing, renewal periods, and continuing education.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Hello and welcome to Up to Speed. Samantha here, and I am joined with a very
special guest who happens to be my mother and also Obi-Wan Kenobi of Insurance
Licensing 101 from Lightspeed Learning, Nancy Strickler.
Good afternoon. Good afternoon, Samantha.
We are gonna dive into some incredible questions that we hear a lot over here at Lightspeed.
(00:22):
Licensing, how do we get a license? What goes into getting a license?
The timeline, the cost, all the different details.
Nancy, let's dive in. Okay.
So if you're a brand new person, my first question is, what kind of insurance do you wish to sell?
Great starting point, because there are about eight different types of insurance licenses.
(00:46):
When I first started in this business over 25 years ago, there was only two.
There was a life slash health and disability license and a what that time was
called a fire casualty license.
Now we have life only, we have accident and health only, we have a full property casualty.
(01:08):
We also can get only a personal lines license and even an auto only license.
So you need to know what products you want to sell before you embark down this path.
And that's there's a lot of of different line items with every single different
license, and we'll talk about that a little later on today, just about where we break it all down.
Is there a benefit to having so many different licenses?
(01:31):
Well, if you were what we in the industry called fully licensed,
which would mean you would have both a life, acts, and health or sickness license
and a property casualty license,
you would be licensed to sell any type of insurance product with the exception
of variable contract life insurance products because you need a securities license
(01:55):
to go along with your life and health license to sell those products.
Which is, you know, we're really glad that we have you to kind of shepherd us through this path.
It's a lot. There is too many different choices. So I have only been licensed
in property and casualty.
And with a full 52-hour pre-licensing course, property casualty,
you can sell home, auto, and commercial.
(02:17):
But did I hear you correct? Is there a commercial only too? There is no commercial license.
Only auto, there is an auto only. There is an auto only license.
Which is kind of, in my opinion, kind of a silly license to get because you're
really limiting yourself because you can only sell personal auto insurance,
four wheels, two axles, 1,500-pound vehicles.
(02:41):
So with that said, you couldn't even ride a dually pickup.
I mean, it's got six wheels. Yes, it does.
Okay, okay. Okay. So now that we figured out where we're going to have to break
down and look at all the different types of licenses, we've decided which one
we're going to narrow into.
Then what does the timeline look like when we want to, you know,
(03:01):
maybe start this conversation and then, you know, pick a course,
start taking the course, take a test and then pass it?
Like what is a typical lifespan here of idea to actual license in hand?
From the day you purchase a pre-licensing package,
it would probably take a person, if they were mildly motivated,
(03:25):
to go through the course at a leisurely pace, probably three to four weeks.
Because it is a 52-hour requirement, regardless on whether you do it in a classroom or online. line.
It's still 52 hours because that's what the state law states.
(03:46):
So from you buy the course, you're going to go through the 12-hour code and ethics.
And let's say you do three hours a day. So that's going to take you four days.
And then let's say you're going to do property casualty. So you have a 40-hour
property and casualty pre-licensing course to complete.
And if you you divided 40 by four hours a day, it would take you 10 days.
(04:10):
Let's say you're only going to do three hours a day, so maybe 12 days to get
through the 40 hours. So typically, we're looking at a normal person, a couple of weeks.
You know, 30 days to six weeks kind of thing. Okay. Okay.
Then after you finish the pre-licensing, you would still need to study the online exam prep.
And if you have a textbook, you would go through the objectives,
(04:31):
making sure you know what each one means, because those objectives are written
by the state of California.
And that is what they derive all the state exam questions from.
So it's a terrific study guide to go down the list of educational objectives. Which are robust.
Very robust. Yeah. For property casualty, the objectives are about 40 pages long in 10 font.
(04:53):
Yeah, that's a lot. It's a lot. And the code and ethics is basically our general
rules and regs as far as the overall concept of code of conduct in the... Correct.
It's the rules and laws that govern the sale of insurance in the state of California.
And every test you take, state insurance licensing exam, will include code and
(05:15):
ethics with the exception of of commercial-only test, and we'll talk more about that later.
Right. So have you ever looked at the code book? I have. You have one,
I think, in your office. I do. How many pages is it?
I don't even know, but it is comparable to an actual Bible.
(05:36):
It is written in probably eight font on very thin paper, and it is a four-inch thick book.
Yeah, it's a lot. lot. Yeah, I've seen it before. It's kind of,
it's a lot. So we've got our 52 hours done.
We've narrowed down that we're going to get this test, you know, passed.
What are the things that we do to prepare to take the test? So we obviously
(05:58):
have to schedule an examination.
You do have to schedule when you have to go take a state test.
So you have to go somewhere to do it.
Not necessarily true. They now have an option that you can do remote testing
in your own home or office as long as you have a camera on your computer because
someone in the test proctor world will be watching you on a monitor.
(06:23):
That's cool. And it is cool because it started during COVID but they've kept
it on board because a lot of people take advantage.
I remember in the old days you had to go downtown to the state buildings and
you can go downtown Los Angeles.
You can still I'll do that on spring. But so after you finish your 52 hours,
we recommend that you then get a test date scheduled.
(06:43):
And you do that on a third-party website called psiexams.com.
Once again, that's paulsamidahoexamsplural.com.
And on that website, you have to then choose which state exam you want to sign up for.
(07:05):
And you have to choose where you wish to take the exam.
They still do offer the exam downtown Los Angeles at 300 South Spring Street
in the Ronald Reagan Building.
That particular facility is still run and managed by Department of Insurance employees.
It is the only test site in the entire state of California still managed by
(07:28):
the Department of Insurance.
All the other test sites are run and managed by PSI. And there are about 25
different locations throughout the state, from Northern California all the way
to San Diego. How much does it cost to take the test?
Downtown Los Angeles, that would be listed as a CDI test site for California
(07:50):
Department of Insurance. It's still $55.
However, you do have to pay for parking, and you do have to drive downtown LA.
So you need to factor in that traffic, whether you're coming from Ventura County or Riverside County.
So what about a remote one? Is it less money? If you choose a PSI test site,
(08:12):
you then have the option of going to a PSI testing location or signing up for a remote test.
Those both cost $98 because PSI is allowed to charge what is called a convenience
fee, which I think is about $45 or $48.
(08:33):
So if you're in Southern California, you would probably go to the downtown if
you wanted to. But if you're in other places, then you're going to have to probably.
This remote thing sounds very cool. I mean, I'm interested to see how they can
proctor that because there's not, you know, I remember when I took my test,
it was like taking the SATs. I mean, you had people monitoring.
They still proctor you by watching on a monitor. And there is software that
(08:57):
you have to download before you can begin the test.
And I always recommend to people that they log in to their computer and download
that software at least an hour early in case they have any glitches with that
download process because you want to be able to start your test on time.
Time because I think if it's beyond 10 minutes from your scheduled time,
(09:19):
they'll cancel your exam.
And no one wants that to happen after they're all ready. So now that we're digging
into the exam, how many questions is the normal, let's say, property and casualty
or just the full-on life license? How many questions and how much time do they give us?
The property casualty license as well as the life, accident,
health, or sickness license are both 150-question exams. Exams,
(09:42):
they are multiple choice.
You take it on a computer, whether you do it downtown LA at a PSI test site
or your own computer, it's all done on a computer.
Again, multiple choice. You have to have 90 correct answers out of the 150 to
pass that test, which equates to a 60% pass ratio.
(10:05):
That's a D minus for our friends listening out there. You just have to get there.
You just have to get there. But it is a hard test. I mean, it is.
It is a hard test. If you're not versed and taking the time to really understand
the concepts, and rightfully so.
Granted. You want to make sure that the people that are out there selling these
products. Are knowledgeable.
Know what they're doing. That is correct. So it's a three hour gig.
It's a three, and they give you three hours of time to take it.
(10:28):
And one interesting thing that a lot of people don't know is out of that 150
questions, about 30 or 35 of those questions will come out of the 12-hour code and ethics material.
So you need to know that well. And for someone such as yourself that already
has a PNC license, if you were now coming back to get a life and accident health or sickness license,
(10:50):
you would not have to repeat repeat the 12 hours of code and ethics,
but you will have to study it because you will be tested on it.
Even though it's been 20 years? Even though it's been 20 years.
Because the state knows that you did it when you got your property casualty
license. It's in their database.
But they'll test you on that again, so you still need to study that.
(11:12):
Because as a seasoned insurance professional for 20 years, you should know that stuff.
Those should be 30 to 35 easy questions you get right. Right. I would hope so.
Okay. So now that we've kind of got our resident California license under our
belt, talk to me about what it looks like to get licensed in other states.
Do I have to take a test and do hours in these other states?
(11:34):
Let's say now I want to do business in Nevada.
What does that mean? How do I do it? Where do I go? I want to back up a moment
before we talk about other states. Okay.
And let's continue with the licensing process.
Let's say you've studied, that you've now gone and passed your test. And now what do you do?
Well, you're not a licensed agent the day you pass your test.
(11:55):
You now have to get fingerprinted.
And it doesn't matter if you've been fingerprinted for real estate or notary
or any other types of licensee or you now have to go get fingerprinted for the
Department of Insurance.
And the fingerprints are live scan fingerprinting.
If you, some test sites offer fingerprinting services If they do get them done
(12:19):
there, it'll be the cheapest place for you to do.
But if they don't offer them, you can go to any place that does live scan fingerprinting.
You just have to bring the form with you that you print off the Department of
Insurance website because it has special department code numbers on it.
So the results will be sent to the Department of Insurance.
(12:41):
Do you have to do it multiple times? Like say I did it one year and five years
later. If I live scan at one point, do I have to live scan again?
No. No. But if you were licensed 30 years ago and you did ink and roll fingerprints
like they used to do in old school, then if you now came back and got a second
license, you would have to do life.
It seems a little silly that they don't communicate with other government agencies
(13:04):
when you have to get fingerprinted, like to volunteer with the kids' school
or something like that. But that would be too easy, I suppose.
It would be. So I totally did step over another thing I wanted to talk about.
Once you pass, you have to submit an application and apply for the license.
And that is done on yet another website called circon.com.
(13:24):
That's spelled S-I-R-C-O-N.com.
And you would go to circon.com and you would click on the orange button that
says apply for a license.
And you would be applying for an individual resident license.
And you're going to fill out this large application that has a lot of background
(13:46):
information, information, past employment history for a period of five years,
if you've ever filed a bankruptcy,
been in any trouble with the law, felonies, misdemeanors, back taxes,
if you've ever had any other government-issued license revoked.
And if you answer yes to any of those background questions, then you have to
(14:11):
write a statement about what the incident was.
What happens if you don't disclose it? They're going to find out.
They're going to find out because if you've ever been arrested,
you've been fingerprinted. And remember, you had to do that fingerprinting form.
So it's going to turn up in your background.
So you want to fill your application out as honestly as you possibly can.
(14:33):
Because if you neglect to disclose one of those issues,
and, oh, gee, your fingerprint background report comes back,
then whoever's reviewing your application at the Department of Insurance is
going to say this person lied on this question.
What else on this application is not true? And are they the best person to be
(14:55):
out there with a lesson? Yes, so we want to be honest.
Not to say that any prior infractions in your background would prevent you from getting a license.
We have heard many things over the nearly 30 years being in this business.
What's been the most wild? Here, I'm going to tell you a little story. Yeah, please do.
(15:18):
We had a gentleman come in, do the class, take his test, and now it was time
to submit the application.
And he had some big skeletons in his closet. Now, this man was probably in his
early 60s, and these infractions occurred when he was maybe 18 years old.
He got busted with 25 pounds of marijuana in the trunk of his car.
(15:45):
And I think that was a trafficking felony that he was charged with. Yeah.
So fast forward to now this man's 60 years old and he's trying to get an insurance license.
Well, back when he was 18, whatever happened to him happened to him.
You know, he did whatever time, paid the fine, whatever.
(16:05):
And did probation and went about his life and never got in any other trouble.
So on this application, we instructed him to literally write out exactly what
happened, when it happened, where it happened, what the resolve was,
and add a statement of accountability that this was an error in judgment on
his part when he was young, and now he was mature and hadn't been in any other trouble. Fair.
(16:30):
And it did take a little longer for the state to review you his application
and his letter of explanation.
But ultimately, they did issue him a unrestricted license, a full PNC license.
And he has gone about his business, started an agency, and has done quite well.
So it kind of feels like disclosure is kind of something, I mean,
(16:53):
let's just be honest. Yes. Got to be disclosing everything.
And the point I really wanted to make, though, So even though you have something
in your background, it may not prevent you from getting a license.
You just have to own up to it and disclose it. So just going back on the process,
so I find it very interesting, these extra steps that might not be clear to
(17:13):
just the average folk, that we need to apply for the exam through one place.
Then you have to apply for the license with another application through another place.
Then once we pass the test, we still have to go through a little bit of an approval process.
The day we pass our test isn't the day we get our license number now.
(17:34):
No. Once we pass that test, how long does it take to get the actual number?
From the day you submit your license or the application...
Let's say you got fingerprinted that same day, but from the day you submit the
application and you pay, I forgot to mention, there is a $188 application fee.
So from the day you pay that, it's a minimum of 10 business days until they
(17:59):
would issue your license number.
And you cannot sell insurance until you get that number. You cannot because
you are not a licensed agent until they issue your insurance license.
You also cannot do any continuing education until you get that license numbered
issued because there is a start date of licensure,
and any continuing education certificates
(18:20):
would need to be dated after the start date of your licensure.
So much. So much. A lot of stuff. I mean, wow. Okay. Now, can we talk about
getting your nonresident license?
We can. Again, you can be a non-resident agent in all other 49 states,
(18:40):
but you can only be a resident in the state that you live in a minimum of six
months and one day out of the year.
So if you were a California agent and you now want to write business in Arizona,
you can go on the nipr.org website. site.
(19:02):
National Insurance Producer Registry.
And you can apply for a non-resident Arizona license.
And it's a matter of filling out forms and paying fees.
And then voila, you have a non-res Arizona license. It's pretty quick.
It's a 24 to 48 hour approval.
Typically, you only, I think, would have holdups if you answer yes to any of
(19:24):
the felony bankruptcy background questions.
And pretty much I think all states except for maybe one or two are on that.
National producer. I think they all offer reciprocity if you're licensed in
one. They're all there. Yes, I believe so.
And then so one of the questions, because I have been licensed in many different
states, is it's hard to keep track of all of these licenses.
(19:47):
And when they renew and the fees, there are a few services that provide.
There are some companies that will keep track of license year.
Like if you had a large agency and you were licensed in 40 different states.
Those are all renewal fees per license number that have to be paid usually every other year.
And it's on average around $100, I'd say like $100 to $150, like $80 to $120,
(20:14):
I think, on average per state. I think California is one of the more expensive licensing states.
Yeah. Some of them are not much at all. Others are more.
And I think some of them also only license for one year as opposed to two.
So you need to be cognizant if you're paying a renewal fee for a 24-month term or a 12-month term.
Yeah, there's a company we used to use called Supportive Agency Services,
(20:37):
something around those lines.
And they did a great job. And then there's also Zircon, which is a program that
you can do a lot with that can help maintain and keep track, too.
There are just some different subscriptions. And, of course, those cost fees to use.
But there is simplicity that I think when you have a lot of licenses because it is hard to keep track.
And a lot of the other thing to remember is it's not only the individual,
(20:58):
but if you're operating as a business entity, then those also would need to be non-res licensed.
In these other, typically you need to register the entity and then one of the
producers or the principal would need to have a license in each state as well for each line.
Yes. Right. So it's not just PNC. If you're doing life as well, you'd have to do both.
(21:18):
And one other point I'd like to bring up a little backtracking. Please do.
We talked about not being a licensed agent till the day your license number is issued.
So now you're a brand new puppy, you got your license issued, Thank you.
You printed it off the department's website. You have it in a frame. You're really excited.
(21:39):
But you still cannot transact any business because you now need to get carrier appointments.
Whether you're selling property casualty or selling life or health insurance,
you still have to be appointed by a carrier, also known as an insurance company, to sell their products.
(22:02):
But with a caveat, if you're going to be a broker, which can be on the property
and casualty side of things, meaning you can broker out to many,
you do need to purchase a $10,000 broker bond. Broker bond.
Right? Which typically is good for three years, I believe, in the state of California.
But you need to post a bond. It's about $125 to do so.
(22:22):
And then that will allow you to charge fees and also not be necessarily captive
or appointed with a carrier.
You can access multiple lines. So as we continue our journey down the licensing
path, let's talk about continuing ed.
So now that we've got our license, we're ready to rock.
We've got continuing education to think about every two years?
(22:44):
Every two years. And how many hours do we need?
Every agent needs 24 continuing education credit hours every 24 months.
Regardless of license type?
With one exception. Okay. Okay.
The only exception is the auto-only license. It is only required to get 20 hours.
(23:06):
Why not just do the extra four and keep it across the board?
However, of the 24 credits required for all insurance licenses,
at least three of those credits must be in an ethics category.
They don't care if you do more than three in ethics, but it's a minimum of three
for that total of 24. And if you're selling homeowners, do you still need to
(23:30):
do the requirement there? It's a valuation?
It's a homeowner valuation course, and it's a one-time requirement.
Many companies that write homeowners insurance require it. I do believe it is a law.
They should write it before they write up a homeowner policy application.
Sure. Another mandated course on the PNC side would be flood insurance if you're selling flood.
(23:54):
Mm-hmm. And these are quick, you know, one hour. There are three hours,
three or four hour courses that can be done online.
So could you do the same thing every, like, so let's say I wanted to do my 25
hours, you know, year one, I could bang them all out and be done with it.
Then the next year, could I do the same course and would it roll over?
Or do I want to be making sure to do different courses in a renewal period?
(24:18):
Well, let's back up because that 24 hours is for a 24-month renewal period, not just one year.
A renewal term, remember, is 24 months, two years.
So if you did all your CEs in that first year, I would suggest you put a reminder
in your calendar for maybe two months before your expiration date so that you
(24:42):
remember to go pay your renewal fee.
Because there's two pieces to renewal.
One is doing the education requirement and the second one is paying the fees.
Which those come in an email format from the Department of Insurance.
Typically, you're going to get an email letting you know. About 90 days before
your license expires. So make sure your email's up to date with the Department
(25:03):
of Insurance. Otherwise, you're not going to get it.
And I always recommend people use a personal email address when they apply for
that license as opposed to a business email address Because remember,
people, this is your license.
It's your responsibility to take care of and renew.
And you have no one to blame but yourself if it expires. You have heard it here first, okay?
(25:25):
Mom is coming out. So here's a question. What if I'm a little bit of someone
who's not been paying attention and I let my license lapse?
What are the penalties? Well, it's a 50% penalty fee.
So the renewal fee is $188 per line.
Well, life and health would be one line. Property casualty would be a second line.
(25:47):
So if you are fully licensed and have both licenses, it's $188 times two to renew.
Let's say you did the CEs for those licenses, but forgot to pay the fees on time.
Well, now you still have to pay the $188 per license to renew the renewal fee.
(26:08):
And you also are now going to get hit with a 50% penalty.
So it's an additional $188, $94 penalty for the life and health,
$94 penalty for the P&C. see.
So you have to pay for each line of business, but the hours go by the license number.
That is correct. So I don't need 50 or 48. I only need 24 for the license number.
(26:31):
That is correct. But I got to pay two times.
Because you have different lines of authority under that number.
Okay. Just to make that clear. A lot of people think they are going to get a
different number issued when they get the second license, but that is untrue.
It's all under one license number, and then you you have different authorities
under that license number.
So the Department of Insurance has a great place on their website where you
(26:53):
can push a button and check your license status.
And there you will be able to see how your name is listed.
You'll be able to see your business address. So if you've moved,
switched companies, that's a place where you can get some things updated and
update your email, although not published publicly.
You can update things online. It'll also show you your hours and when they're due by. Correct.
(27:13):
So maybe at the end of listening to this, you may want to see where you're at and what's going on.
One thing that I always have a lot of questions that I get from people is,
hey, if I do like a CPCU, you'll get a ton of hours for that because that's
basically a master's degree in insurance.
Those CE hours, can you do a bunch that will roll over quickly?
(27:34):
How does that rollover work? You can roll over as many as you need in the next renewal period.
So let's say you had 48 hours in this period and you have ethics and you have
everything. You have plenty to renew.
So your license renews. Well, it's going to roll forward 24 credits.
But what you have to look for in that next renewal is the ethics category will not be satisfied.
(28:00):
So you'll still have to do the ethics. You always will have to do a fresh ethics
course because it has to be dated within the dates of each renewal period.
You can't do 1,000 hours and it's only going to be enough for that next period.
Yeah, they won't let you keep rolling over indefinitely.
Okay. Okay, I'd like to touch on the CEs for a new life agent,
(28:23):
life only or a life accident health or sickness agent.
If they wish to sell annuity products, there's some specific requirements for
continuing ed that they must do before they write up an annuity application.
A new life agent would need to do a eight-hour annuity training course before
(28:44):
they could write an annuity application.
And annuities is a little bit odd than all the other CE requirements because
the way the law is written, the first renewal period that you want to sell an annuity product,
you would do that eight-hour course, and that would cover you for that full first 24 months.
But in your next renewal period, you would only do a four-hour annuity training
(29:09):
course, not an eight, because the requirement drops to a four-hour course. This is complicated.
It is complicated. This is complicated. And a lot of people will know they need
annuities, and they will choose the eight-hour course because they think eight
is going to be better than four.
But the way the law is written, the eight-hour course will not satisfy the four-hour requirement.
(29:32):
They would get eight standard CE credits, but it won't satisfy that annuity requirement.
Wow. So first year, if you're selling annuities, do the eight hours.
After that, it's four hours. Only four.
And if you're confused, as I still maybe am, call Nancy.
Happy to answer your question. Happy to. So here is... The other requirement is long-term care.
(29:54):
Oh, yeah. So if you are a accident health or sickness agent or a life,
accident health or sickness agent and going to write long-term care policies,
the law for CEs on this product is eight hours per year, 12 months,
the first four years you're licensed.
(30:15):
Licensed so if you are actively selling long-term care you would have to do
16 hours of long-term care in your first renewal period 24 months would it count,
For 16 hours? It would, if they were two different courses. They'd have to be
different courses. Two different course numbers.
And then in their next renewal period, it would be their second renewal.
(30:36):
Again, they would have to do 16 hours of long-term care credit.
My head is literally in a tailspin. Then the next two years,
it would drop down to a single eight-hour long-term care course from then till
infinity, for as long as they're licensed.
Okay. Well, you know what? That was a lot. It was a lot. That was a lot more. But it's important.
(30:58):
It is indeed. And that is why we have you to kind of help us.
So here's another question, Obi-Wan.
The types of hours that I do. So we had previously discussed that I'm a property and casualty person.
So I obviously would be doing courses approved for P&C.
But there's also a business, what is it? Business management category.
(31:19):
Business management category. I can get hours there too.
You can. Again, we have done business management classes, and primarily they're
usually done in a live setting, like a contact CE course where you go and sit
in a room with a bunch of other agents.
And the way the law is written in the insurance code is you can get up to seven
(31:41):
business management CE credits per 24-month renewal period, which is cool. Yeah. Yeah. Yeah.
And business management courses are cool because they give agents and agencies
maybe a different perspective on how to handle a problem or how to better serve their clients.
And so it's a cool category as opposed to just standard old property casualty.
(32:07):
But I think going a little further on the live versus book versus online course,
all of us have at certain points waited to the last minute, right?
Uh-oh, I got to get the hours done.
And you just got to get it done. And, you know, that's fine.
But that's not, I think, the best way to be thinking about CE.
Because in my mind, like I would, if I'm going to take the time,
(32:28):
I want to learn something.
Absolutely. I'm a person who learns best in a live classroom around,
you know, people. I'm a listener.
That's where I can really dig in. Some people are great with books.
Others, you know, can really thrive in that online environment.
I like that there's multiple different options of getting the courseware.
But I think you got to, You know, pick and choose. So you're not just wasting
(32:49):
your time. Pick a subject that is something you want to learn a little bit about.
Absolutely. And, you know, take away something because you got to do it.
And the other thing is, is there's always an exam.
Open book or not live classes, no test.
Right. But even online, they cannot have the book open and the test at the same
time. That is a state law.
That is a no-no. But there is the continuing ed does have you need to take an exam.
(33:14):
You do. Yeah. And so you can read the book and then close the book and then go do the exam.
And if you miss too many on the exam and don't fail it, scroll down, review what you missed,
close that window, and then maybe go back up and open that book and look for
the area that you were lacking knowledge in to answer those questions so that
(33:34):
you are learning something.
The idea is that it is continuing education. That is correct.
We're never, you know, not doing ourselves a service by learning.
Knowledge is power. Thank you for that. Headline.
That's it. We're done. No. Okay. Okay, so we have covered a lot of different
concepts and information.
In summary, can you just give me the total cost of what it looks like to get my license?
(33:59):
You know, how much does it cost from start to finish?
Ballpark numbers to get a property casualty license would cost you around $500.
Same for life? Same for life. Yeah. That includes the cost of the course,
the exam fee, the application fee, the fingerprint fee.
(34:23):
And if you studied well, you're going to pass that test on the first try.
You do need to keep in mind, each time you take the state exam,
you have to repay the exam fee.
Which is the 98 or the 55. Correct. Correct. So you fail that exam three times.
Listen, you need to go in there. You want to pass. Yeah, you want to pass the
(34:46):
first time. You totally do.
Okay, so we've got the cost of around $500, and then we're kind of looking at
all in, realistically, you know, anywhere from a month to six weeks to be ready to rock.
Correct. Okay, so now we've got our marching orders there.
Recapping the keeping track of all the different licenses. And I know from being
in the seat of agency management, it's a doozy trying to keep track of all your
(35:08):
staff's licenses and numbers and non-resident licenses.
Some of the things that we've used, I've used in the past, you know,
something as simple as a Google Doc that everybody can input their information
and then you can keep track.
I even had one gal who would set up appointment reminders in the calendar, like an Outlook.
And it was basically then that was how we would keep track of everyone's license.
(35:29):
And it An Excel sheet's a great way.
And again, you know, highlighting some of those services that you can pay for
that are companies that actually are in the business of maintaining and helping
you to keep track of your license renewals and non-resident licenses.
They're Zircon, Supportive. There's a couple of different places that,
you know, are good. But again, you do have to pay for them.
(35:49):
You do. And another good thing to do if you have a large agency,
put that onus on the agent because because you as the agency owner are probably
paying for their continuing ed, probably paying for their renewal fee.
I mean, Nancy, let's remember, you know, be cognizant of when their license
(36:09):
expires. Yeah, it's hard.
You cannot write business with an expired license. It's hard.
It's hard to basically just do get up and be let alone remember their insurance
license or that they've got continuing education.
It is important, though, and a lot of companies do, you know,
have have parameters or incentives you know hey
if you complete your continuing ed or let us know these things we'll
(36:30):
pay for it or we'll do different things so i
think you really just figure what works best for your your operation but
you know we are all grown-ups and if this is your livelihood then you definitely
you don't want to be the one that let your license lapse and didn't do your
continuing ed and then call you because you are going to read the riot act i
have heard it and i I have seen it in action. So don't mess with Nancy.
(36:53):
Well, from where I sit...
If this is your livelihood, this is how you earn a living, feed your family,
pay for your vacations, take care of your license.
Don't wait till that last week when it's going to expire because all hell could
break loose. You could have an atmospheric river.
The internet could go out. You could be out of power and you could not be able to.
(37:18):
There could be a global pandemic. There could be a global pandemic,
but you might run into a situation where something's preventing you,
and because you've waited until that last few days before you expire.
So what happens if I blow it and I don't renew it? Like, how long do I have
before my license goes away forever?
(37:38):
Okay, so if you did, something happened, God forbid, you were sick or whatever,
you didn't renew one time.
You have a one-year grace period given to you from the state of California that
during that one-year period, you still can do the continuing education credits,
wait till they are posted, and then you can go on Zircon and pay your regular
(38:01):
renewal fee plus that 50% penalty fee.
And you have literally 365 days to do that. Which is a good grace.
But if it's one day, if it's like 10 minutes after midnight on that last day,
it's over. Your license is gone.
I think that's fair. You would have to start all over through the entire process,
(38:22):
take 52 hours, take the exam, the whole nine yards.
Another thing I want to mention about expired licenses that a lot of people
are unaware of, when these licenses do get reinstated, they do not change your expiration date.
It will remain the same every two years on the 30th or 31st of the month,
(38:45):
whether you're an even year or an odd year, that's not going to change.
So if you renew a year late, like within a few days right to the end to your
grace period, you're already one year into that next renewal period.
So you got to put a calendar reminder for next year so you don't let it expire a second time.
Will they not give you that grace the second time? No, but then the agents are
(39:08):
paying what I call stupid tax, that 50% penalty fee.
It's either 94 bucks if you got one license or it's $188 penalty if you have
both and that gets expensive.
That's not smart. Okay, okay, here's a good one. Do I have to do CEs forever,
or is there a time where I don't have to do CEs anymore?
There is a CE exemption rule that if you have been licensed 70,
(39:33):
I mean, no, if you have been licensed 30 or more consecutive years with no lapse
in license year, meaning you never renewed late. Right.
And you are now 70 years of age, you can email the Department of Insurance and
request the CE exemption. It's as simple as that.
(39:55):
You only have to ask for it, and I've never seen them deny it.
But you just fill out a little form on their website. You still have to pay
the fees. You still got to pay the fees.
But you don't have to do the hours. You don't have to do the hours,
with the exception of if you want to sell annuities, you want to sell long-term
care. You still have to do those mandated training CEs, but you don't have to
(40:15):
do ethics or anything else.
So that's a little something we all get to look forward to. It's a total something
to strive for. Hopefully by the time I'm 70, I'm not still selling insurance.
I don't know, though. I don't know. Nancy, we have learned so many things today.
My head is spinning. All these different requirements and all this different information.
Years and years of getting to understand everything that you need to,
(40:37):
you know, keep your license up, Get your license and all the ever-changing rules
and regs with the Code and Ethics. Thank you for your time today.
I can't wait for you to show us up next what it looks like online.
So follow us as we go check it out on the big screen.
Thanks, everybody. We'll see you next time on Up to Speed.
Hello and welcome to Up to Speed. Samantha here, and I am joined with a very
special guest who happens to be my mother and also Obi-Wan Kenobi of Insurance
Licensing 101 from Lightspeed Learning, Nancy Strickler.
Good afternoon. Good afternoon, Samantha.
We are gonna dive into some incredible questions that we hear a lot over here at Lightspeed.
(00:22):
Licensing, how do we get a license? What goes into getting a license?
The timeline, the cost, all the different details.
Nancy, let's dive in. Okay.
So if you're a brand new person, my first question is, what kind of insurance do you wish to sell?
Great starting point, because there are about eight different types of insurance licenses.
(00:46):
When I first started in this business over 25 years ago, there was only two.
There was a life slash health and disability license and a what that time was
called a fire casualty license.
Now we have life only, we have accident and health only, we have a full property casualty.
(01:08):
We also can get only a personal lines license and even an auto only license.
So you need to know what products you want to sell before you embark down this path.
And that's there's a lot of of different line items with every single different
license, and we'll talk about that a little later on today, just about where we break it all down.
Is there a benefit to having so many different licenses?
(01:31):
Well, if you were what we in the industry called fully licensed,
which would mean you would have both a life, acts, and health or sickness license
and a property casualty license,
you would be licensed to sell any type of insurance product with the exception
of variable contract life insurance products because you need a securities license
(01:55):
to go along with your life and health license to sell those products.
Which is, you know, we're really glad that we have you to kind of shepherd us through this path.
It's a lot. There is too many different choices. So I have only been licensed
in property and casualty.
And with a full 52-hour pre-licensing course, property casualty,
you can sell home, auto, and commercial.
(02:17):
But did I hear you correct? Is there a commercial only too? There is no commercial license.
Only auto, there is an auto only. There is an auto only license.
Which is kind of, in my opinion, kind of a silly license to get because you're
really limiting yourself because you can only sell personal auto insurance,
four wheels, two axles, 1,500-pound vehicles.
(02:41):
So with that said, you couldn't even ride a dually pickup.
I mean, it's got six wheels. Yes, it does.
Okay, okay. Okay. So now that we figured out where we're going to have to break
down and look at all the different types of licenses, we've decided which one
we're going to narrow into.
Then what does the timeline look like when we want to, you know,
(03:01):
maybe start this conversation and then, you know, pick a course,
start taking the course, take a test and then pass it?
Like what is a typical lifespan here of idea to actual license in hand?
From the day you purchase a pre-licensing package,
it would probably take a person, if they were mildly motivated,
(03:25):
to go through the course at a leisurely pace, probably three to four weeks.
Because it is a 52-hour requirement, regardless on whether you do it in a classroom or online. line.
It's still 52 hours because that's what the state law states.
(03:46):
So from you buy the course, you're going to go through the 12-hour code and ethics.
And let's say you do three hours a day. So that's going to take you four days.
And then let's say you're going to do property casualty. So you have a 40-hour
property and casualty pre-licensing course to complete.
And if you you divided 40 by four hours a day, it would take you 10 days.
(04:10):
Let's say you're only going to do three hours a day, so maybe 12 days to get
through the 40 hours. So typically, we're looking at a normal person, a couple of weeks.
You know, 30 days to six weeks kind of thing. Okay. Okay.
Then after you finish the pre-licensing, you would still need to study the online exam prep.
And if you have a textbook, you would go through the objectives,
(04:31):
making sure you know what each one means, because those objectives are written
by the state of California.
And that is what they derive all the state exam questions from.
So it's a terrific study guide to go down the list of educational objectives. Which are robust.
Very robust. Yeah. For property casualty, the objectives are about 40 pages long in 10 font.
(04:53):
Yeah, that's a lot. It's a lot. And the code and ethics is basically our general
rules and regs as far as the overall concept of code of conduct in the... Correct.
It's the rules and laws that govern the sale of insurance in the state of California.
And every test you take, state insurance licensing exam, will include code and
(05:15):
ethics with the exception of of commercial-only test, and we'll talk more about that later.
Right. So have you ever looked at the code book? I have. You have one,
I think, in your office. I do. How many pages is it?
I don't even know, but it is comparable to an actual Bible.
(05:36):
It is written in probably eight font on very thin paper, and it is a four-inch thick book.
Yeah, it's a lot. lot. Yeah, I've seen it before. It's kind of,
it's a lot. So we've got our 52 hours done.
We've narrowed down that we're going to get this test, you know, passed.
What are the things that we do to prepare to take the test? So we obviously
(05:58):
have to schedule an examination.
You do have to schedule when you have to go take a state test.
So you have to go somewhere to do it.
Not necessarily true. They now have an option that you can do remote testing
in your own home or office as long as you have a camera on your computer because
someone in the test proctor world will be watching you on a monitor.
(06:23):
That's cool. And it is cool because it started during COVID but they've kept
it on board because a lot of people take advantage.
I remember in the old days you had to go downtown to the state buildings and
you can go downtown Los Angeles.
You can still I'll do that on spring. But so after you finish your 52 hours,
we recommend that you then get a test date scheduled.
(06:43):
And you do that on a third-party website called psiexams.com.
Once again, that's paulsamidahoexamsplural.com.
And on that website, you have to then choose which state exam you want to sign up for.
(07:05):
And you have to choose where you wish to take the exam.
They still do offer the exam downtown Los Angeles at 300 South Spring Street
in the Ronald Reagan Building.
That particular facility is still run and managed by Department of Insurance employees.
It is the only test site in the entire state of California still managed by
(07:28):
the Department of Insurance.
All the other test sites are run and managed by PSI. And there are about 25
different locations throughout the state, from Northern California all the way
to San Diego. How much does it cost to take the test?
Downtown Los Angeles, that would be listed as a CDI test site for California
(07:50):
Department of Insurance. It's still $55.
However, you do have to pay for parking, and you do have to drive downtown LA.
So you need to factor in that traffic, whether you're coming from Ventura County or Riverside County.
So what about a remote one? Is it less money? If you choose a PSI test site,
(08:12):
you then have the option of going to a PSI testing location or signing up for a remote test.
Those both cost $98 because PSI is allowed to charge what is called a convenience
fee, which I think is about $45 or $48.
(08:33):
So if you're in Southern California, you would probably go to the downtown if
you wanted to. But if you're in other places, then you're going to have to probably.
This remote thing sounds very cool. I mean, I'm interested to see how they can
proctor that because there's not, you know, I remember when I took my test,
it was like taking the SATs. I mean, you had people monitoring.
They still proctor you by watching on a monitor. And there is software that
(08:57):
you have to download before you can begin the test.
And I always recommend to people that they log in to their computer and download
that software at least an hour early in case they have any glitches with that
download process because you want to be able to start your test on time.
Time because I think if it's beyond 10 minutes from your scheduled time,
(09:19):
they'll cancel your exam.
And no one wants that to happen after they're all ready. So now that we're digging
into the exam, how many questions is the normal, let's say, property and casualty
or just the full-on life license? How many questions and how much time do they give us?
The property casualty license as well as the life, accident,
health, or sickness license are both 150-question exams. Exams,
(09:42):
they are multiple choice.
You take it on a computer, whether you do it downtown LA at a PSI test site
or your own computer, it's all done on a computer.
Again, multiple choice. You have to have 90 correct answers out of the 150 to
pass that test, which equates to a 60% pass ratio.
(10:05):
That's a D minus for our friends listening out there. You just have to get there.
You just have to get there. But it is a hard test. I mean, it is.
It is a hard test. If you're not versed and taking the time to really understand
the concepts, and rightfully so.
Granted. You want to make sure that the people that are out there selling these
products. Are knowledgeable.
Know what they're doing. That is correct. So it's a three hour gig.
It's a three, and they give you three hours of time to take it.
(10:28):
And one interesting thing that a lot of people don't know is out of that 150
questions, about 30 or 35 of those questions will come out of the 12-hour code and ethics material.
So you need to know that well. And for someone such as yourself that already
has a PNC license, if you were now coming back to get a life and accident health or sickness license,
(10:50):
you would not have to repeat repeat the 12 hours of code and ethics,
but you will have to study it because you will be tested on it.
Even though it's been 20 years? Even though it's been 20 years.
Because the state knows that you did it when you got your property casualty
license. It's in their database.
But they'll test you on that again, so you still need to study that.
(11:12):
Because as a seasoned insurance professional for 20 years, you should know that stuff.
Those should be 30 to 35 easy questions you get right. Right. I would hope so.
Okay. So now that we've kind of got our resident California license under our
belt, talk to me about what it looks like to get licensed in other states.
Do I have to take a test and do hours in these other states?
(11:34):
Let's say now I want to do business in Nevada.
What does that mean? How do I do it? Where do I go? I want to back up a moment
before we talk about other states. Okay.
And let's continue with the licensing process.
Let's say you've studied, that you've now gone and passed your test. And now what do you do?
Well, you're not a licensed agent the day you pass your test.
(11:55):
You now have to get fingerprinted.
And it doesn't matter if you've been fingerprinted for real estate or notary
or any other types of licensee or you now have to go get fingerprinted for the
Department of Insurance.
And the fingerprints are live scan fingerprinting.
If you, some test sites offer fingerprinting services If they do get them done
(12:19):
there, it'll be the cheapest place for you to do.
But if they don't offer them, you can go to any place that does live scan fingerprinting.
You just have to bring the form with you that you print off the Department of
Insurance website because it has special department code numbers on it.
So the results will be sent to the Department of Insurance.
(12:41):
Do you have to do it multiple times? Like say I did it one year and five years
later. If I live scan at one point, do I have to live scan again?
No. No. But if you were licensed 30 years ago and you did ink and roll fingerprints
like they used to do in old school, then if you now came back and got a second
license, you would have to do life.
It seems a little silly that they don't communicate with other government agencies
(13:04):
when you have to get fingerprinted, like to volunteer with the kids' school
or something like that. But that would be too easy, I suppose.
It would be. So I totally did step over another thing I wanted to talk about.
Once you pass, you have to submit an application and apply for the license.
And that is done on yet another website called circon.com.
(13:24):
That's spelled S-I-R-C-O-N.com.
And you would go to circon.com and you would click on the orange button that
says apply for a license.
And you would be applying for an individual resident license.
And you're going to fill out this large application that has a lot of background
(13:46):
information, information, past employment history for a period of five years,
if you've ever filed a bankruptcy,
been in any trouble with the law, felonies, misdemeanors, back taxes,
if you've ever had any other government-issued license revoked.
And if you answer yes to any of those background questions, then you have to
(14:11):
write a statement about what the incident was.
What happens if you don't disclose it? They're going to find out.
They're going to find out because if you've ever been arrested,
you've been fingerprinted. And remember, you had to do that fingerprinting form.
So it's going to turn up in your background.
So you want to fill your application out as honestly as you possibly can.
(14:33):
Because if you neglect to disclose one of those issues,
and, oh, gee, your fingerprint background report comes back,
then whoever's reviewing your application at the Department of Insurance is
going to say this person lied on this question.
What else on this application is not true? And are they the best person to be
(14:55):
out there with a lesson? Yes, so we want to be honest.
Not to say that any prior infractions in your background would prevent you from getting a license.
We have heard many things over the nearly 30 years being in this business.
What's been the most wild? Here, I'm going to tell you a little story. Yeah, please do.
(15:18):
We had a gentleman come in, do the class, take his test, and now it was time
to submit the application.
And he had some big skeletons in his closet. Now, this man was probably in his
early 60s, and these infractions occurred when he was maybe 18 years old.
He got busted with 25 pounds of marijuana in the trunk of his car.
(15:45):
And I think that was a trafficking felony that he was charged with. Yeah.
So fast forward to now this man's 60 years old and he's trying to get an insurance license.
Well, back when he was 18, whatever happened to him happened to him.
You know, he did whatever time, paid the fine, whatever.
(16:05):
And did probation and went about his life and never got in any other trouble.
So on this application, we instructed him to literally write out exactly what
happened, when it happened, where it happened, what the resolve was,
and add a statement of accountability that this was an error in judgment on
his part when he was young, and now he was mature and hadn't been in any other trouble. Fair.
(16:30):
And it did take a little longer for the state to review you his application
and his letter of explanation.
But ultimately, they did issue him a unrestricted license, a full PNC license.
And he has gone about his business, started an agency, and has done quite well.
So it kind of feels like disclosure is kind of something, I mean,
(16:53):
let's just be honest. Yes. Got to be disclosing everything.
And the point I really wanted to make, though, So even though you have something
in your background, it may not prevent you from getting a license.
You just have to own up to it and disclose it. So just going back on the process,
so I find it very interesting, these extra steps that might not be clear to
(17:13):
just the average folk, that we need to apply for the exam through one place.
Then you have to apply for the license with another application through another place.
Then once we pass the test, we still have to go through a little bit of an approval process.
The day we pass our test isn't the day we get our license number now.
(17:34):
No. Once we pass that test, how long does it take to get the actual number?
From the day you submit your license or the application...
Let's say you got fingerprinted that same day, but from the day you submit the
application and you pay, I forgot to mention, there is a $188 application fee.
So from the day you pay that, it's a minimum of 10 business days until they
(17:59):
would issue your license number.
And you cannot sell insurance until you get that number. You cannot because
you are not a licensed agent until they issue your insurance license.
You also cannot do any continuing education until you get that license numbered
issued because there is a start date of licensure,
and any continuing education certificates
(18:20):
would need to be dated after the start date of your licensure.
So much. So much. A lot of stuff. I mean, wow. Okay. Now, can we talk about
getting your nonresident license?
We can. Again, you can be a non-resident agent in all other 49 states,
(18:40):
but you can only be a resident in the state that you live in a minimum of six
months and one day out of the year.
So if you were a California agent and you now want to write business in Arizona,
you can go on the nipr.org website. site.
(19:02):
National Insurance Producer Registry.
And you can apply for a non-resident Arizona license.
And it's a matter of filling out forms and paying fees.
And then voila, you have a non-res Arizona license. It's pretty quick.
It's a 24 to 48 hour approval.
Typically, you only, I think, would have holdups if you answer yes to any of
(19:24):
the felony bankruptcy background questions.
And pretty much I think all states except for maybe one or two are on that.
National producer. I think they all offer reciprocity if you're licensed in
one. They're all there. Yes, I believe so.
And then so one of the questions, because I have been licensed in many different
states, is it's hard to keep track of all of these licenses.
(19:47):
And when they renew and the fees, there are a few services that provide.
There are some companies that will keep track of license year.
Like if you had a large agency and you were licensed in 40 different states.
Those are all renewal fees per license number that have to be paid usually every other year.
And it's on average around $100, I'd say like $100 to $150, like $80 to $120,
(20:14):
I think, on average per state. I think California is one of the more expensive licensing states.
Yeah. Some of them are not much at all. Others are more.
And I think some of them also only license for one year as opposed to two.
So you need to be cognizant if you're paying a renewal fee for a 24-month term or a 12-month term.
Yeah, there's a company we used to use called Supportive Agency Services,
(20:37):
something around those lines.
And they did a great job. And then there's also Zircon, which is a program that
you can do a lot with that can help maintain and keep track, too.
There are just some different subscriptions. And, of course, those cost fees to use.
But there is simplicity that I think when you have a lot of licenses because it is hard to keep track.
And a lot of the other thing to remember is it's not only the individual,
(20:58):
but if you're operating as a business entity, then those also would need to be non-res licensed.
In these other, typically you need to register the entity and then one of the
producers or the principal would need to have a license in each state as well for each line.
Yes. Right. So it's not just PNC. If you're doing life as well, you'd have to do both.
(21:18):
And one other point I'd like to bring up a little backtracking. Please do.
We talked about not being a licensed agent till the day your license number is issued.
So now you're a brand new puppy, you got your license issued, Thank you.
You printed it off the department's website. You have it in a frame. You're really excited.
(21:39):
But you still cannot transact any business because you now need to get carrier appointments.
Whether you're selling property casualty or selling life or health insurance,
you still have to be appointed by a carrier, also known as an insurance company, to sell their products.
(22:02):
But with a caveat, if you're going to be a broker, which can be on the property
and casualty side of things, meaning you can broker out to many,
you do need to purchase a $10,000 broker bond. Broker bond.
Right? Which typically is good for three years, I believe, in the state of California.
But you need to post a bond. It's about $125 to do so.
(22:22):
And then that will allow you to charge fees and also not be necessarily captive
or appointed with a carrier.
You can access multiple lines. So as we continue our journey down the licensing
path, let's talk about continuing ed.
So now that we've got our license, we're ready to rock.
We've got continuing education to think about every two years?
(22:44):
Every two years. And how many hours do we need?
Every agent needs 24 continuing education credit hours every 24 months.
Regardless of license type?
With one exception. Okay. Okay.
The only exception is the auto-only license. It is only required to get 20 hours.
(23:06):
Why not just do the extra four and keep it across the board?
However, of the 24 credits required for all insurance licenses,
at least three of those credits must be in an ethics category.
They don't care if you do more than three in ethics, but it's a minimum of three
for that total of 24. And if you're selling homeowners, do you still need to
(23:30):
do the requirement there? It's a valuation?
It's a homeowner valuation course, and it's a one-time requirement.
Many companies that write homeowners insurance require it. I do believe it is a law.
They should write it before they write up a homeowner policy application.
Sure. Another mandated course on the PNC side would be flood insurance if you're selling flood.
(23:54):
Mm-hmm. And these are quick, you know, one hour. There are three hours,
three or four hour courses that can be done online.
So could you do the same thing every, like, so let's say I wanted to do my 25
hours, you know, year one, I could bang them all out and be done with it.
Then the next year, could I do the same course and would it roll over?
Or do I want to be making sure to do different courses in a renewal period?
(24:18):
Well, let's back up because that 24 hours is for a 24-month renewal period, not just one year.
A renewal term, remember, is 24 months, two years.
So if you did all your CEs in that first year, I would suggest you put a reminder
in your calendar for maybe two months before your expiration date so that you
(24:42):
remember to go pay your renewal fee.
Because there's two pieces to renewal.
One is doing the education requirement and the second one is paying the fees.
Which those come in an email format from the Department of Insurance.
Typically, you're going to get an email letting you know. About 90 days before
your license expires. So make sure your email's up to date with the Department
(25:03):
of Insurance. Otherwise, you're not going to get it.
And I always recommend people use a personal email address when they apply for
that license as opposed to a business email address Because remember,
people, this is your license.
It's your responsibility to take care of and renew.
And you have no one to blame but yourself if it expires. You have heard it here first, okay?
(25:25):
Mom is coming out. So here's a question. What if I'm a little bit of someone
who's not been paying attention and I let my license lapse?
What are the penalties? Well, it's a 50% penalty fee.
So the renewal fee is $188 per line.
Well, life and health would be one line. Property casualty would be a second line.
(25:47):
So if you are fully licensed and have both licenses, it's $188 times two to renew.
Let's say you did the CEs for those licenses, but forgot to pay the fees on time.
Well, now you still have to pay the $188 per license to renew the renewal fee.
(26:08):
And you also are now going to get hit with a 50% penalty.
So it's an additional $188, $94 penalty for the life and health,
$94 penalty for the P&C. see.
So you have to pay for each line of business, but the hours go by the license number.
That is correct. So I don't need 50 or 48. I only need 24 for the license number.
(26:31):
That is correct. But I got to pay two times.
Because you have different lines of authority under that number.
Okay. Just to make that clear. A lot of people think they are going to get a
different number issued when they get the second license, but that is untrue.
It's all under one license number, and then you you have different authorities
under that license number.
So the Department of Insurance has a great place on their website where you
(26:53):
can push a button and check your license status.
And there you will be able to see how your name is listed.
You'll be able to see your business address. So if you've moved,
switched companies, that's a place where you can get some things updated and
update your email, although not published publicly.
You can update things online. It'll also show you your hours and when they're due by. Correct.
(27:13):
So maybe at the end of listening to this, you may want to see where you're at and what's going on.
One thing that I always have a lot of questions that I get from people is,
hey, if I do like a CPCU, you'll get a ton of hours for that because that's
basically a master's degree in insurance.
Those CE hours, can you do a bunch that will roll over quickly?
(27:34):
How does that rollover work? You can roll over as many as you need in the next renewal period.
So let's say you had 48 hours in this period and you have ethics and you have
everything. You have plenty to renew.
So your license renews. Well, it's going to roll forward 24 credits.
But what you have to look for in that next renewal is the ethics category will not be satisfied.
(28:00):
So you'll still have to do the ethics. You always will have to do a fresh ethics
course because it has to be dated within the dates of each renewal period.
You can't do 1,000 hours and it's only going to be enough for that next period.
Yeah, they won't let you keep rolling over indefinitely.
Okay. Okay, I'd like to touch on the CEs for a new life agent,
(28:23):
life only or a life accident health or sickness agent.
If they wish to sell annuity products, there's some specific requirements for
continuing ed that they must do before they write up an annuity application.
A new life agent would need to do a eight-hour annuity training course before
(28:44):
they could write an annuity application.
And annuities is a little bit odd than all the other CE requirements because
the way the law is written, the first renewal period that you want to sell an annuity product,
you would do that eight-hour course, and that would cover you for that full first 24 months.
But in your next renewal period, you would only do a four-hour annuity training
(29:09):
course, not an eight, because the requirement drops to a four-hour course. This is complicated.
It is complicated. This is complicated. And a lot of people will know they need
annuities, and they will choose the eight-hour course because they think eight
is going to be better than four.
But the way the law is written, the eight-hour course will not satisfy the four-hour requirement.
(29:32):
They would get eight standard CE credits, but it won't satisfy that annuity requirement.
Wow. So first year, if you're selling annuities, do the eight hours.
After that, it's four hours. Only four.
And if you're confused, as I still maybe am, call Nancy.
Happy to answer your question. Happy to. So here is... The other requirement is long-term care.
(29:54):
Oh, yeah. So if you are a accident health or sickness agent or a life,
accident health or sickness agent and going to write long-term care policies,
the law for CEs on this product is eight hours per year, 12 months,
the first four years you're licensed.
(30:15):
Licensed so if you are actively selling long-term care you would have to do
16 hours of long-term care in your first renewal period 24 months would it count,
For 16 hours? It would, if they were two different courses. They'd have to be
different courses. Two different course numbers.
And then in their next renewal period, it would be their second renewal.
(30:36):
Again, they would have to do 16 hours of long-term care credit.
My head is literally in a tailspin. Then the next two years,
it would drop down to a single eight-hour long-term care course from then till
infinity, for as long as they're licensed.
Okay. Well, you know what? That was a lot. It was a lot. That was a lot more. But it's important.
(30:58):
It is indeed. And that is why we have you to kind of help us.
So here's another question, Obi-Wan.
The types of hours that I do. So we had previously discussed that I'm a property and casualty person.
So I obviously would be doing courses approved for P&C.
But there's also a business, what is it? Business management category.
(31:19):
Business management category. I can get hours there too.
You can. Again, we have done business management classes, and primarily they're
usually done in a live setting, like a contact CE course where you go and sit
in a room with a bunch of other agents.
And the way the law is written in the insurance code is you can get up to seven
(31:41):
business management CE credits per 24-month renewal period, which is cool. Yeah. Yeah. Yeah.
And business management courses are cool because they give agents and agencies
maybe a different perspective on how to handle a problem or how to better serve their clients.
And so it's a cool category as opposed to just standard old property casualty.
(32:07):
But I think going a little further on the live versus book versus online course,
all of us have at certain points waited to the last minute, right?
Uh-oh, I got to get the hours done.
And you just got to get it done. And, you know, that's fine.
But that's not, I think, the best way to be thinking about CE.
Because in my mind, like I would, if I'm going to take the time,
(32:28):
I want to learn something.
Absolutely. I'm a person who learns best in a live classroom around,
you know, people. I'm a listener.
That's where I can really dig in. Some people are great with books.
Others, you know, can really thrive in that online environment.
I like that there's multiple different options of getting the courseware.
But I think you got to, You know, pick and choose. So you're not just wasting
(32:49):
your time. Pick a subject that is something you want to learn a little bit about.
Absolutely. And, you know, take away something because you got to do it.
And the other thing is, is there's always an exam.
Open book or not live classes, no test.
Right. But even online, they cannot have the book open and the test at the same
time. That is a state law.
That is a no-no. But there is the continuing ed does have you need to take an exam.
(33:14):
You do. Yeah. And so you can read the book and then close the book and then go do the exam.
And if you miss too many on the exam and don't fail it, scroll down, review what you missed,
close that window, and then maybe go back up and open that book and look for
the area that you were lacking knowledge in to answer those questions so that
(33:34):
you are learning something.
The idea is that it is continuing education. That is correct.
We're never, you know, not doing ourselves a service by learning.
Knowledge is power. Thank you for that. Headline.
That's it. We're done. No. Okay. Okay, so we have covered a lot of different
concepts and information.
In summary, can you just give me the total cost of what it looks like to get my license?
(33:59):
You know, how much does it cost from start to finish?
Ballpark numbers to get a property casualty license would cost you around $500.
Same for life? Same for life. Yeah. That includes the cost of the course,
the exam fee, the application fee, the fingerprint fee.
(34:23):
And if you studied well, you're going to pass that test on the first try.
You do need to keep in mind, each time you take the state exam,
you have to repay the exam fee.
Which is the 98 or the 55. Correct. Correct. So you fail that exam three times.
Listen, you need to go in there. You want to pass. Yeah, you want to pass the
(34:46):
first time. You totally do.
Okay, so we've got the cost of around $500, and then we're kind of looking at
all in, realistically, you know, anywhere from a month to six weeks to be ready to rock.
Correct. Okay, so now we've got our marching orders there.
Recapping the keeping track of all the different licenses. And I know from being
in the seat of agency management, it's a doozy trying to keep track of all your
(35:08):
staff's licenses and numbers and non-resident licenses.
Some of the things that we've used, I've used in the past, you know,
something as simple as a Google Doc that everybody can input their information
and then you can keep track.
I even had one gal who would set up appointment reminders in the calendar, like an Outlook.
And it was basically then that was how we would keep track of everyone's license.
(35:29):
And it An Excel sheet's a great way.
And again, you know, highlighting some of those services that you can pay for
that are companies that actually are in the business of maintaining and helping
you to keep track of your license renewals and non-resident licenses.
They're Zircon, Supportive. There's a couple of different places that,
you know, are good. But again, you do have to pay for them.
(35:49):
You do. And another good thing to do if you have a large agency,
put that onus on the agent because because you as the agency owner are probably
paying for their continuing ed, probably paying for their renewal fee.
I mean, Nancy, let's remember, you know, be cognizant of when their license
(36:09):
expires. Yeah, it's hard.
You cannot write business with an expired license. It's hard.
It's hard to basically just do get up and be let alone remember their insurance
license or that they've got continuing education.
It is important, though, and a lot of companies do, you know,
have have parameters or incentives you know hey
if you complete your continuing ed or let us know these things we'll
(36:30):
pay for it or we'll do different things so i
think you really just figure what works best for your your operation but
you know we are all grown-ups and if this is your livelihood then you definitely
you don't want to be the one that let your license lapse and didn't do your
continuing ed and then call you because you are going to read the riot act i
have heard it and i I have seen it in action. So don't mess with Nancy.
(36:53):
Well, from where I sit...
If this is your livelihood, this is how you earn a living, feed your family,
pay for your vacations, take care of your license.
Don't wait till that last week when it's going to expire because all hell could
break loose. You could have an atmospheric river.
The internet could go out. You could be out of power and you could not be able to.
(37:18):
There could be a global pandemic. There could be a global pandemic,
but you might run into a situation where something's preventing you,
and because you've waited until that last few days before you expire.
So what happens if I blow it and I don't renew it? Like, how long do I have
before my license goes away forever?
(37:38):
Okay, so if you did, something happened, God forbid, you were sick or whatever,
you didn't renew one time.
You have a one-year grace period given to you from the state of California that
during that one-year period, you still can do the continuing education credits,
wait till they are posted, and then you can go on Zircon and pay your regular
(38:01):
renewal fee plus that 50% penalty fee.
And you have literally 365 days to do that. Which is a good grace.
But if it's one day, if it's like 10 minutes after midnight on that last day,
it's over. Your license is gone.
I think that's fair. You would have to start all over through the entire process,
(38:22):
take 52 hours, take the exam, the whole nine yards.
Another thing I want to mention about expired licenses that a lot of people
are unaware of, when these licenses do get reinstated, they do not change your expiration date.
It will remain the same every two years on the 30th or 31st of the month,
(38:45):
whether you're an even year or an odd year, that's not going to change.
So if you renew a year late, like within a few days right to the end to your
grace period, you're already one year into that next renewal period.
So you got to put a calendar reminder for next year so you don't let it expire a second time.
Will they not give you that grace the second time? No, but then the agents are
(39:08):
paying what I call stupid tax, that 50% penalty fee.
It's either 94 bucks if you got one license or it's $188 penalty if you have
both and that gets expensive.
That's not smart. Okay, okay, here's a good one. Do I have to do CEs forever,
or is there a time where I don't have to do CEs anymore?
There is a CE exemption rule that if you have been licensed 70,
(39:33):
I mean, no, if you have been licensed 30 or more consecutive years with no lapse
in license year, meaning you never renewed late. Right.
And you are now 70 years of age, you can email the Department of Insurance and
request the CE exemption. It's as simple as that.
(39:55):
You only have to ask for it, and I've never seen them deny it.
But you just fill out a little form on their website. You still have to pay
the fees. You still got to pay the fees.
But you don't have to do the hours. You don't have to do the hours,
with the exception of if you want to sell annuities, you want to sell long-term
care. You still have to do those mandated training CEs, but you don't have to
(40:15):
do ethics or anything else.
So that's a little something we all get to look forward to. It's a total something
to strive for. Hopefully by the time I'm 70, I'm not still selling insurance.
I don't know, though. I don't know. Nancy, we have learned so many things today.
My head is spinning. All these different requirements and all this different information.
Years and years of getting to understand everything that you need to,
(40:37):
you know, keep your license up, Get your license and all the ever-changing rules
and regs with the Code and Ethics. Thank you for your time today.
I can't wait for you to show us up next what it looks like online.
So follow us as we go check it out on the big screen.
Thanks, everybody. We'll see you next time on Up to Speed.
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