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15.1 Insurance Regulations

Licensing​

The licensing process serves to protect the public by ensuring that individuals who obtain an insurance license are competent, properly qualified, and accountable for their professional conduct.

A license is required to solicit, negotiate, or transact insurance business in any capacity. This includes activities such as taking applications, quoting premiums, discussing coverage, writing, delivering, or renewing policies, and issuing binders.

Qualifications​

Issuance of a Resident Agent License

The Superintendent is required to issue a resident agent license to an individual applicant who satisfies all of the following criteria:

  • The applicant must be at least 18 years of age.
  • The applicant must not have committed any act that would constitute grounds for the denial, suspension, or revocation of an insurance license.
  • The applicant must complete all required prelicensing education and successfully pass the licensing examination for each line of authority for which licensure is sought, if applicable.
  • The applicant must demonstrate good reputation and character, and must be considered honest, trustworthy, and otherwise suitable for licensure.
  • The applicant must consent to a criminal records check, and the results of that check must be deemed satisfactory by the Superintendent.
  • The applicant must be a United States citizen or provide acceptable proof of legal authorization to work in the United States.

A business entity may be issued an insurance license if it meets all of the following requirements:

  • The business must be domiciled in Ohio or maintain its principal place of business within the state.
  • The business must designate a properly licensed agent who will be responsible for ensuring the entity's compliance with applicable insurance laws and regulations.
  • The business must not have committed any act that would constitute grounds for the denial, suspension, or revocation of a license.
  • The business must submit any additional forms or documentation requested by the Superintendent as part of the licensing process.

An insurance agent license must include the following information:

  • The full name of the licensee.
  • The license number, date of issuance, and expiration date.
  • The specific lines of authority granted under the license.
  • Any other information deemed necessary by the Superintendent.

Insurance licenses are issued according to specific lines of authority:

  • Major Lines

    • Life: Authorizes coverage on human lives, including endowments, annuities, death benefits, and disability income benefits.
    • Accident and Health: Provides coverage for losses resulting from sickness, bodily injury, or accidental death, and may include disability income benefits.
    • Property: Covers direct or consequential loss of or damage to real or personal property.
    • Casualty: Covers liability exposures, including death, bodily injury, personal injury, disability, and property damage.
    • _Personal Lines: _Authorizes the sale of noncommercial property and casualty insurance designed for individuals and families.
    • Variable Life and Variable Annuity Products: Covers insurance and annuity products whose value varies based on underlying investment performance.
      • Applicants seeking this line of authority must be registered with Financial Industry Regulatory Authority (FINRA) and must successfully complete any required FINRA examinations.

  • Limited Lines

  • Surety Bail Bonds: Coverage that guarantees the appearance of a defendant in court.

  • Title Insurance: Protection against financial loss arising from defects in or disputes over the ownership of real property.

  • Credit Insurance: Coverage that pays a borrower's debt in the event of death, disability, or other specified circumstances.

  • Portable Electronics Insurance: Coverage for loss, theft, or damage to portable electronic devices such as mobile phones and tablets.

  • Self-Service Storage Insurance: Coverage for personal property stored in self-service storage facilities against risks such as theft or damage.

  • Travel Insurance: Coverage for risks associated with travel, including trip cancellation, medical emergencies, and lost or delayed baggage.

1. Which of the following activities requires an individual to hold an insurance license?

A. Providing general financial advice unrelated to insurance

B. Quoting premiums and discussing coverage options with a client

C. Marketing non-insurance products only

D. Processing payroll for an insurance company employee

Correct Answer: B

Rationale: Quoting premiums and discussing coverage constitutes soliciting or negotiating insurance, which legally requires an active insurance license.

Prelicensing Requirements​

Prior to taking the Ohio insurance licensing examination, candidates must complete a minimum of 20 hours of approved prelicensing education for each line of authority for which licensure is sought. The required lines include:

  • Life
  • Accident and Health
  • Property and Casualty
  • Surety Bail Bond
  • Personal Lines

The following individuals are exempt from completing prelicensing education requirements:

  • Individuals who have earned an associate's or bachelor's degree in insurance from an accredited institution.
  • Individuals who have obtained a professional designation that has been approved by the Superintendent of Insurance.

Prelicensing education is valid for a period of 180 days. Applicants must successfully pass the state licensing examination within this timeframe.

Application for Resident Insurance Agent License​

An applicant may not submit a completed license application until all required licensing examinations have been successfully passed. Once the examination requirement is satisfied, the application must be submitted within 180 days of the exam passing date.

An extension of this timeframe may be granted if the applicant is deployed for active military service.

An applicant is not eligible for licensure until the Superintendent has received a complete application. A complete application must include the application form, results of the criminal records check, all required fees, and any additional information requested by the Superintendent.

Applications that are incomplete cannot be processed and may be returned to the applicant for completion.

An individual applying for a resident agent license must submit the uniform application (or another application approved by the Superintendent) along with a declaration affirming that all statements made in the application are true, accurate, and complete to the best of the applicant's knowledge.

A business entity seeking licensure as an insurance agent must submit the uniform business entity application.

Each applicant must provide consent for a criminal records check and submit a complete set of fingerprints to the Superintendent. The fingerprints are used by the Bureau of Criminal Identification and Investigation to conduct a background check.

The Superintendent may also request additional criminal history information from the Federal Bureau of Investigation (FBI).

All information obtained through the criminal records check process is considered confidential and is not subject to subpoena or admissible as evidence in a private civil action.

A license is considered issued on the date the application is approved by the Superintendent. The license will be issued in the applicant's legal name.

1. Which of the following statements is TRUE regarding Ohio insurance prelicensing and application requirements?

A. An applicant may submit a license application before passing the required exam

B. Prelicensing education is valid indefinitely once completed

C. A complete application must include a criminal records check and required fees

D. All applicants must complete prelicensing education regardless of prior qualifications

Correct Answer: C

Rationale: A complete application must include all required components, including the application form, criminal records check, fees, and any additional information; applications cannot be submitted before passing the exam, prelicensing is only valid for 180 days, and certain qualified individuals may be exempt from prelicensing requirements.

Nonresident Licensees​

An agent may apply for a nonresident license in Ohio if Ohio is not the agent's home state. The home state is defined as the state, territory, or district in which the agent maintains their principal residence or principal place of business and is properly licensed to act as an insurance agent.

An individual may be licensed in this state as a nonresident agent or broker without taking a written examination, provided the applicant meets all of the following requirements:

  • The applicant is currently licensed and in good standing in their home state, and that state grants nonresident licenses to Ohio residents on a reciprocal basis.
  • The applicant has submitted a license request along with the NAIC uniform application or a copy of the application submitted to their home state.
  • The applicant demonstrates that they are trustworthy and possess good character.
  • The applicant has not committed any act that would constitute grounds for the denial, suspension, or revocation of a license.

To obtain a nonresident business entity license, the business must meet the following requirements:

  • Submit the nonresident uniform business entity application.
  • Be properly authorized to conduct business in Ohio.
  • Designate a licensed individual agent who is responsible for the entity's compliance and conduct.

The Department may revoke a nonresident license if the licensee fails to maintain an active resident license in another state. To verify an applicant's licensure status, the Superintendent may utilize the NAIC's producer database or require a certification of licensure from the applicant's home state.

Temporary License​

The Superintendent may issue a temporary insurance agent license for a period not to exceed 180 days without requiring the applicant to pass a written examination. This license may be granted when necessary to ensure the continued servicing of insurance business.

A temporary license may be issued to any of the following individuals:

  • Surviving Spouse or Legal Representative
  • The surviving spouse or a court-appointed representative of a licensed agent who has died or become mentally or physically disabled. This allows for the orderly sale of the business, the potential return of the agent, or the training and licensing of new personnel to continue operations.
  • Business Entity Member or Employee
  • A member or employee of a licensed business entity upon the death or disability of the sole remaining licensed agent.
  • Military Designee
  • A designated individual acting on behalf of a licensed agent who has entered active duty in the U.S. Armed Forces.
  • Other Individuals in the Public Interest
  • Any other person, as determined by the Superintendent, when issuance of the license serves the public interest.

A temporary licensee must be sponsored by a licensed agent or insurer, who assumes responsibility for all actions of the temporary licensee. A temporary license will terminate once the insurance business being serviced by the temporary licensee has been sold, transferred, or otherwise concluded.

The Superintendent may restrict the scope of authority granted under a temporary license. The license may also be rescinded if the Superintendent determines that the interests of insureds or the public are at risk.

Exceptions to Education or Examination Requirements​

An individual who applies for a resident insurance agent license in Ohio within 90 days of establishing a principal place of residence or place of business may be exempt from prelicensing education and the written examination requirements, provided all applicable fees are paid and one of the following conditions is met:

  • The individual holds an active license in another state and is in good standing for the line or lines of authority being requested.
  • The individual was previously licensed in another state, and the application for an Ohio resident license is submitted within 90 days after the cancellation of the prior home state license. At the time of cancellation, the individual must have been in good standing for the applicable line or lines of authority.

An individual applying for a temporary agent license is not required to complete prelicensing education or pass a written examination.

The Superintendent may waive the written examination requirement for applicants seeking licensure in certain limited lines of insurance.

Maintenance and Duration​

Change in Name, Address, Email, Telephone Number​

An agent is required to notify the Superintendent of any changes to demographic information within 30 days of the change. This includes updates to the agent's name, residential address, business address, mailing address, email address, and telephone number.

If a licensed agent changes their home state, the agent must notify the Superintendent by filing a change of address and submitting certification of licensure from the new home state within 30 days of the change.

If these requirements are met and the agent's license remains in good standing, the license will be converted to a nonresident license. No additional application or fee is required for this change.

1. Which of the following statements is TRUE regarding nonresident and temporary insurance licenses?

A. A nonresident applicant must always pass a written examination

B. A temporary license may be issued for more than 1 year

C. A temporary licensee must be sponsored by a licensed agent or insurer

D. A nonresident license cannot be revoked once issued

Correct Answer: C

Rationale: A temporary licensee must be sponsored by a licensed agent or insurer who is responsible for their actions; nonresident applicants may be exempt from exams, temporary licenses are limited to 180 days, and nonresident licenses can be revoked if requirements are not maintained.

Renewal/Nonrenewal​

An individual seeking to renew a resident insurance agent license must submit a renewal application biennially, every two years, on or before the last day of the licensee's birth month. A renewal notice will be issued to all licensees at least one month prior to the renewal deadline.

To qualify for license renewal, the licensee must satisfy all of the following requirements:

  • Submit a completed renewal application using the form prescribed by the Superintendent.
  • Pay the required biennial license renewal fee.
  • Complete all required continuing education (CE) credits prior to submitting the renewal application.
  • Must not have committed any act that would constitute grounds for the suspension, revocation, or denial of a license.
  • Provide any additional documentation reasonably requested by the Superintendent to verify the information contained in the renewal application.

After the initial renewal, individual resident and nonresident insurance agent licenses expire biennially on the last day of the agent's birth month. The period from the initial date of licensure to the first license expiration must be no less than 18 months and no more than 29 months.

Nonresident business entities are required to renew their licenses by September 30 of each odd-numbered year. This renewal deadline continues on the last day of September in every subsequent odd-numbered year.

Resident business entities are required to renew their licenses by September 30 of each even-numbered year. This renewal deadline continues on the last day of September in every subsequent even-numbered year.

All surety bail bond agents are required to renew their licenses annually on or before the last day of February.

If an individual or business entity fails to submit a renewal application by the required renewal date, a late renewal application may still be filed before the first day of the second month following the renewal deadline. The late renewal must include all applicable fees, including the standard renewal fee and an additional $50 late filing fee.

A license that is not renewed by the required deadline will be automatically suspended for nonrenewal on the first day of the second month following the renewal date. If a license is suspended for nonrenewal, the individual or business entity may apply for reinstatement within 12 months after the original renewal deadline. Reinstatement requires payment of all applicable fees, including the standard renewal fee and an additional $100 reinstatement fee.

A license that has been suspended for nonrenewal and is not reinstated will be automatically canceled upon completion of the investigation, unless the Superintendent elects to revoke the license.

Duty to Report Criminal Convictions and Administrative Disciplinary Actions​

An agent is required to notify the Superintendent of the following events:

  • Any administrative action taken against the agent by another jurisdiction or by a governmental agency with professional, occupational, or financial licensing authority must be reported within 30 days of the final disposition. The agent must include a copy of the order, consent order, or any other relevant legal documentation.
  • Any criminal prosecution, excluding misdemeanor traffic offenses, must be reported within 30 days of the agent's initial appearance before a judge or magistrate. The notification must include a certified copy of the charging document. Additionally, within 30 days of the final disposition, the agent must provide a certified copy of the court's order or entry reflecting the outcome of the case, along with any other relevant legal documentation.

Assumed Business Names​

An insurance agent who intends to conduct business in Ohio under a name other than their legal name must notify the Superintendent before using the assumed name.

1. Which of the following statements is TRUE regarding insurance license renewal and nonrenewal requirements?

A. A license may be reinstated at any time without additional fees

B. Individual agent licenses expire every year on December 31

C. A late renewal may be submitted before the first day of the second month following the renewal deadline with an additional fee

D. Agents are not required to report administrative actions taken in other jurisdictions

Correct Answer: C

Rationale: A late renewal is permitted within a limited timeframe after the renewal deadline and requires payment of both the standard renewal fee and an additional late fee; licenses expire biennially (not annually), reinstatement is limited and includes fees, and agents must report administrative actions.

Continuing Education (CE)​

A license is not eligible for renewal unless the license holder has completed all required continuing education (CE) requirements.

Agents licensed in one or more of the following lines—Property, Casualty, Personal Lines, or Accident and Health—must complete a total of 24 hours of continuing education (CE) prior to license renewal. This requirement must include a minimum of 3 hours of ethics training.

A continuing education (CE) course may not be completed more than once within the same compliance period. However, the same course may be retaken in a subsequent compliance period.

Exemptions​

The 24-hour continuing education (CE) requirement does not apply to the following categories of agents:

  • Agents who hold only a resident title insurance license are required to complete a minimum of 12 CE credits per renewal period, including 10 credits specific to title insurance and 2 credits in ethics.
  • Agents licensed solely in surety bail bonds are exempt from the 24-hour CE requirement.
  • Agents who hold only a limited lines license are not subject to the 24-hour CE requirement.
  • Agents who have been granted inactive status by the Superintendent are exempt from CE requirements while inactive.

1. Which of the following statements is TRUE regarding continuing education (CE) requirements for insurance agents?

A. Agents may repeat the same CE course multiple times within the same compliance period for credit

B. All agents must complete 24 hours of CE regardless of license type

C. Agents licensed in Property and Casualty must complete 24 hours of CE including at least 3 hours of ethics

D. CE is optional if the agent submits their renewal application on time

Correct Answer: C

Rationale: Agents licensed in Property, Casualty, Personal Lines, or Accident and Health must complete 24 hours of CE, including at least 3 hours of ethics; CE courses cannot be repeated in the same period, some agents are exempt from the 24-hour requirement, and CE completion is mandatory for renewal.

CE Transcript and Renewal​

All required continuing education (CE) credits must be completed and properly recorded in the licensee's file with the Ohio Department of Insurance before the license can be renewed.

The Superintendent will maintain and post continuing education (CE) transcripts on the Department's website and will issue a renewal notice indicating whether the resident agent has completed the required CE hours for the applicable renewal period. If the CE transcript or renewal notice shows that the required hours have not been completed, the agent is responsible for demonstrating compliance. The agent should request license renewal only after all required CE hours have been successfully completed.

Failure to receive a renewal notice does not relieve the agent of the obligation to complete all required continuing education (CE) requirements or to renew the license within the prescribed timeframe.

Continuing education (CE) credits must be earned by the agent and recorded in the agent's official record by the continuing education provider or the Superintendent. Credit hours are considered earned on the date the agent completes the course, not the date the credits are posted to the record.

Credits​

To qualify for continuing education (CE) credit, both the course and the course provider must be approved by the Superintendent. The Superintendent may, at their discretion, grant credit for a course conducted prior to the formal issuance of written approval.

An agent who relocates to Ohio and becomes licensed as a resident agent is not permitted to carry over continuing education (CE) credits earned in a previous home state.

If an agent completes the same continuing education (CE) course more than once during a single renewal period, credit will be awarded only for the first completion.

At the provider's discretion, partial credit may be awarded for classroom courses. Any such credit will be calculated in whole-hour increments and rounded down to the nearest hour.

Agents who complete more than the required number of continuing education (CE) credit hours during a renewal period may apply a portion of those excess hours to the next renewal period. The number of carryover hours may not exceed 50% of the required CE hours (up to 12 credit hours) for the subsequent period. Any excess CE hours carried over will be applied as general credit hours.

Continuing education (CE) hours completed during the late renewal period or the reinstatement period may be applied toward satisfying the CE requirements for that renewal cycle.

Credit for Publication, Instruction and Association Events​

Individual licensees may be granted up to 10 hours of continuing education (CE) credit per reporting period for authoring published articles or books on topics directly related to insurance. To receive credit, the licensee must submit a written request to the Superintendent, along with documentation verifying authorship and publication.

Licensees who develop instructional materials for approved continuing education courses may be awarded credit up to the number of CE hours assigned to the course. This credit may be granted only once per course. To receive credit, the licensee must submit a written request to the Superintendent and provide documentation verifying authorship.

Licensees who teach approved continuing education courses may be awarded CE credit once per course during each reporting period. Credit is calculated at twice the number of hours actually spent instructing the course.

Individuals who both author course materials and teach the same course within a single compliance period may receive continuing education (CE) credit for either the authorship or the instruction, but not for both activities during the same compliance period.

An agent may earn up to 4 continuing education (CE) credits per renewal period for membership and active participation in local, regional, state, or national professional insurance associations, provided the agent has paid dues and remains a member in good standing. The association must be approved as a CE provider, and the course must be specifically approved to award membership-related CE credits.

Penalties​

Failure to satisfy continuing education (CE) requirements will result in license suspension. The suspension becomes effective after the Superintendent issues a 60-day notice. During this notice period, the agent has the opportunity to provide proof of compliance.

A license may be revoked if the agent fails to demonstrate compliance within one year after the Superintendent has provided notice and an opportunity for a hearing.

An agent whose license has been revoked due to failure to meet continuing education (CE) requirements must submit a new application to obtain an insurance agent license.

The following actions constitute violations of prelicensing education and continuing education (CE) statutes and rules:

  • Knowingly using, submitting, or filing false or misleading documents or records to satisfy education requirements or in response to inquiries from the Superintendent.
  • Obtaining, accepting, or using evidence of course completion or participation from a provider without actually attending or completing the course.
  • Engaging in cheating, using unauthorized materials, or receiving unauthorized assistance during an examination.
  • Assisting another individual in meeting education requirements when the person knows or reasonably should know that such assistance violates applicable laws or rules.
  • Exhibiting disruptive, threatening, or deceptive conduct during a course or examination. Such behavior may result in termination from the course or exam and may lead to the Superintendent refusing to recognize successful completion.
  • Using unauthorized telecommunication devices, exam notes, study guides, or communicating with unauthorized individuals during an examination.

A single violation may result in either a $500 fine or the Superintendent's refusal to issue a license.

Inactivity Due to Military Service or Extenuating Circumstances​

Licensees who are unable to comply with renewal procedures and are not actively engaged in insurance business due to military service, long-term medical disability, or other extenuating circumstances may request an extension of their renewal deadline. Requests must be submitted in writing, and the Superintendent may decline to consider requests received after the licensee's renewal date. The Superintendent may also waive any additional renewal fees associated with the extension.

License Surrender​

An individual licensed as an insurance agent in Ohio may voluntarily surrender any or all licenses at any time, provided the agent is not currently under investigation by the Superintendent.

An attempt to surrender a license is not valid if the Superintendent is investigating allegations of wrongdoing or has initiated formal proceedings and issued a notice of hearing to the agent.

Inactive Status​

An individual agent may request inactive status from the Superintendent if the agent is no longer engaged in any insurance activities that require licensure and does not intend to engage in such activities for at least 24 months. Business entities are not eligible to apply for inactive status.

At the time of applying for inactive status, the agent must be in good standing with the Superintendent and must have satisfied all continuing education (CE) requirements.

Once inactive status is granted, the individual is no longer subject to continuing education (CE) requirements for the duration of the inactive period.