If you’re an insurance broker or customer service employee in the insurance business, you’re already well aware that you need to get an insurance license to transact—or even discuss—insurance business with prospects and clients in your home state. However, what if you work in one state but live in another? It’s a very common scenario for folks who live in small states or near a state border—or for a licensed insurance agent who normally travels to see clients outside his or her resident state. You will need both a non-resident insurance license and your resident license to transact insurance business.
Getting licensed to sell insurance in multiple states is easier than you might think. But why would you need to do this in the first place? Simple answer: Because insurance is governed by the individual states. And each state requires a state-specific license to sell insurance within their borders.
Now, while the thought of going through the pre-licensing process again won’t sound too appetizing to most producers, fortunately it’s a relatively painless process to get a non-resident license in most cases.
Many states have reciprocal agreements with neighboring states, meaning as long as you have a license in good standing with your resident state, you can apply for and maintain a non-resident license in a neighboring state. However, that’s not the case with all non-resident licensing. Some states have more rigorous requirements when it comes to approving non-resident insurance licenses. Florida, as an example, requires a background check and fingerprinting before they will issue a non-resident license. California, as of this writing, also requires fingerprinting for non-resident producers in order to approve a non-resident license.
Keeping track of the licenses is really the hard part. Licenses will invariably renew on different dates and in different years, making the task of keeping up a daunting one—especially if your primary job is to sell insurance and not to manage licenses. Most larger agencies will have a dedicated person (or team) to keep track of employee licensing. However, it’s up to you as the producer to make sure you get the proper continuing education that satisfies state requirements in a timely way. As long as that happens, non-resident state licenses can be renewed accordingly.
However, if you’re tasked with managing license renewals on your own, be sure to keep things organized. Because licenses and related continuing education course info can be sent (and saved) electronically, save license copies for each state in a dedicated file on your computer, backed up in a cloud drive like Dropbox or Google Drive. Likewise, save all continuing education course completion documents, renewal applications and the like for easy access later.
Set reminders in your email program to alert you a few months prior to your resident license renewal, so that you can complete the required coursework and testing well before the renewal. Also set reminders well before your non-resident state licenses renew—to avoid having to renew a lapsed license. The fees and penalties for renewing an expired license can be larger than if you had renewed on time.
