TMCnet Feature
October 18, 2021

Insurance: Exploring The Different Insurance Licenses

Individuals who choose to become an insurance agent and are armed with the qualification of any type of insurance license have the potential capacity to sell different kinds of insurance policies to individuals, businesses, groups, and entities. Insurance brokers often get certified in the respective state that they reside in since licensing standards vary by the state as well as the type of insurance product the broker offers. 

Most states require potential insurance agents to complete pre-licensing before taking the official licensure exam; however, some do not require any pre-requisite besides being over the age of 18. Candidates who possess some certifications from other states or specific professional designations may sometimes be exempt from a few pre-licensing requirements in various county states. It is important to note that there is no previous requirement to hold a degree or any other college qualification to obtain an insurance license, however career-wise, this may affect your possibility to be hired since, more often than not, employers prefer candidates with some kind of qualification in business or economics.

Difference Types of Insurance Licensure

According to The Really Useful Information Company(TRUiC) , there are several different types of insurance brokers in the US who practice in the various faculties of insurance depending on the policies they specialize in and the licenses they are qualified with. In the US, the two insurance departments fall under and include property & casualty insurance and life & health insurance.

Property and Casualty License

A property and casualty license (P&C License) is the first of the two most general insurance licenses that new insurance brokers obtain. It is crucial to note that property insurance and casualty insurance are two different faculties of insurance coverage; however, most states require licensure for both in order to practice brokerage. This licensure enables the broker the inherent capability to sell insurance products to the likes of homeowners insurance, auto insurance, insurance for commercial property, and professional liability.

A property and casualty license permits insurance brokers to sell and negotiate property and casualty insurance policies that include the likes of protecting people as well as businesses from potential financial loss that may result from property damage, accidental issues, possible theft, natural disaster, and other possible tragic happenings.

Life and Health Insurance

The second general department of insurance would appear to be the life and health insurance faculty. Like the property and casualty insurance licenses, life insurance licenses, and health insurance licenses are two different brokerage departments. However, since life insurance is tied closely with health insurance, most insurance brokers get licensure together.

The life insurance license gives the potential to insurance brokers to qualify in selling life insurance products within their respective states. Having this particular sort of licensure offers brokers the ability and capacity to legally and professionally explain life insurance, market life insurance, and write within this line of business.

Similar to life insurance, the health insurance license allows for an insurance broker to write health insurance products that would be offered within the respective state of the insurance broker. Having a health insurance license for an insurance broker means having the capacity to professionally and legally be recognized by the state as a broker who has the ability to explain, market, and write sequentially for this specific faculty of insurance.

Insurance brokers do have the option of getting either the life insurance license or the health insurance license independently; however, most of the time, agents opt to get both the permits at the same time based on the possibility of being able to write both lines of business for the same clients simultaneously. Some US states do offer to group life and health insurance faculties together into one single licensure exam with a double qualification; however, it is encouraged to check with the corresponding state to confirm if that alternative opportunity is available.

Final Take

As mentioned previously, each state has its own licensure application process and requirements. These insurance license applications are generally found and filled out on an official online state-endorsed website and often include a fee that has the potential to range from as little as $30.00 to as high as $200.00, depending on which state an agent decides to qualify in. Some states require preliminary information and accreditation, and others do not require any type of pre-requisite information; however, it is essential to take into consideration that all states would run a background check on potential candidates to ensure they are worthy of the qualification.

Becoming a US insurance broker is no easy task since it is a prestigious and challenging qualification to obtain. It may be established that any type of broker armed with either a property & casualty license or a life & health insurance license will lead an exciting life of success that comes with many doors of opportunities open to individuals who choose to practice insurance brokerage.

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