New York license maintenance, continuing education, and disciplinary actions (Ins. Law 2103, 2110, 2127, 2132, 2134)

Keeping a New York Producer License: Renewal, Continuing Education and Discipline

Passing the exam gets you a license. Keeping it is a separate job. In New York that job has three parts: renewing on time every two years, completing approved continuing education (CE) during each two-year period, and staying clear of the conduct that lets the superintendent of the Department of Financial Services refuse to renew, suspend or revoke your license.

The two-year licensing period

New York producer licenses run on a biennial licensing period. For an individual, the two-year cycle is tied to the licensee's date of birth. To renew, you file the renewal with the Department, pay the fee, and certify that your CE for the period is complete. A license that is not renewed lapses, and you may not transact insurance on a lapsed license.

Continuing education under Insurance Law section 2132

Who must comply. Section 2132 applies to resident and non-resident licensees for life insurance, annuities, variable annuities and variable life; sickness, accident and health; all lines of property and casualty; life settlements; and title insurance.

Who is exempt.

• People holding a license for which New York requires no examination.
• Limited licensees, and other licensees the superintendent exempts.
• For life settlement CE only: a producer with a life line of authority acting as a life settlement broker under section 2137.
• For a title insurance agent license: a New York attorney in good standing.

How much. During each full biennial licensing period you must complete approved courses, programs or seminars equivalent to 15 credit hours.

No carry-forward. Excess hours earned in one biennial period do not carry forward to the next period for the same class of license. Taking 30 hours this cycle does not reduce next cycle's requirement.

Similar classes. Within the same biennial period, credits can count toward similar classes of license. For example, life agent hours can count toward a life insurance consultant license.

Approved providers. Courses must be approved by the superintendent. They may be given by a registered college or university, or by an institution, agents' association, trade association or insurer that keeps equivalent standards and is approved. An insurer's course counts only if that insurer is authorized to write that class of insurance in New York. The superintendent assigns the credit hours for each course.

Non-residents. A non-resident may satisfy New York with the CE required by the home state where the licensee lives and keeps an insurance office, if the superintendent deems it equivalent. If the home state has no CE requirement, or it is not deemed equivalent, New York's requirement applies.

Instructors. A licensee who teaches an approved course or lectures at an approved seminar earns the same credit hours as a student taking it.

Disciplinary actions under section 2110

After notice and a hearing, the superintendent may refuse to renew, revoke, or suspend the license of a producer, consultant, adjuster or life settlement broker. The grounds include:

• violating insurance laws, regulations or the superintendent's orders;
• materially false or incomplete information on a license application, or obtaining a license by fraud;
• fraudulent, coercive or dishonest practices, incompetence, untrustworthiness or financial irresponsibility;
• withholding, misappropriating or converting money received in the business;
• intentionally misrepresenting the terms of a policy or application;
• a felony conviction, or an insurance unfair trade practice or fraud;
• having a license denied, suspended or revoked in another state;
• forging a name on an application, or using notes during the licensing exam;
• knowingly accepting business from an unlicensed person;
• failing to obey a child support order or to pay New York income tax;
• no longer meeting the requirements for licensure.

The hearing is held at least ten days after notice. Revocation or suspension ends the license immediately, along with the authority of every sub-licensee named on it. After a revocation, the person, and any firm or corporation that person is a member, officer or director of, cannot obtain any license for one year. New York law also lets the superintendent impose a monetary penalty in place of suspension or revocation.

Complaints. A licensed producer or any aggrieved person may file a verified complaint with the superintendent setting out facts that show grounds for revocation or suspension.

Non-residents. A non-resident license may be summarily revoked if the home state suspended, revoked or refused to renew the home license after a procedure with a right to a hearing, for conduct that would have been grounds in New York. The superintendent must first give ten days' written notice. If the home state's action is later withdrawn, reversed or voided, New York must reinstate the license.

Conduct that keeps a license safe

• Premium funds are held in trust. Agents and brokers hold all funds they collect in a fiduciary capacity (section 2120). They may not mingle those funds with their own unless the principal expressly consents. A separate bank account for each principal is not required, provided each principal's funds can be identified from the producer's books.
• No unauthorized insurers. You may not act as agent for, or in any way help, an insurer that is not licensed or authorized in New York (section 2117). Narrow exceptions exist for licensed brokers and excess line brokers.

Temporary licenses when a producer cannot continue

Under section 2109, the superintendent may issue a temporary license without an examination so that a book of business can continue. This covers:

• Death: to the executor or administrator, to next of kin where no estate representative has qualified, to surviving members of the firm, or to a corporate officer or director.
• Military service: to a person designated by a licensee who is absent on armed forces service.
• Total disability: to the next of kin.

A temporary agent may represent only the insurers the original licensee represented. No fee is charged, except that renewals of a military-service designee's license cost half the normal fee.

Renew every two years, complete 15 approved hours each cycle, expect no carry-over credit, and treat every premium dollar as someone else's money.