Can I Act As A Representative Prior To Being Appointed?

An agent may act as a representative of an insurer without being appointed with that insurer for a period of 30 days from the date the first application is executed. In order to act as a representative without being appointed, the agent must have financial responsibility of at least $1,000,000 per occurrence and $2,000,000 in the aggregate on file with the Department. The financial responsibility may be in the form of an errors and omissions policy (Form 99­1), bond (Form 99­3), cash deposit, letter of credit (Form 99­2) or combination of any of these forms. These forms are available by contacting the Department of insurance directly.

An insurer must, within 45 days from the date the first application or agency contract is executed, file a written notice of appointment with the Commissioner and mail a copy of the notice to the agent. The Department then has 15 working days after receiving the notice to notify the insurer whether the agent is eligible for appointment. The insurer must also send the agent a copy of approval of the appointment. If the agent has not received a copy of the approval from the insurer within 30 days from the date the first application was executed, the agent must discontinue representing that insurer until approval is received. Please note that the 30­day time frame for agents and the 45­day time frame for insurers are almost running concurrently.

All those currently licensed agents who want to qualify for this temporary exemption from appointment need to file new financial responsibility; otherwise, the licensed agents need to be appointed with each insurer. At present, the Department's system only reflects the statutory minimum, regardless of the amount of coverage filed in the past.

The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.

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