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Question

Difficulty: EasyLicensing Requirements and Types

MegaCorp Agency is reviewing the daily responsibilities of its staff to ensure full regulatory compliance. According to state insurance laws, which individual is legally required to obtain an insurance producer license?

  1. A customer service representative who earns a commission for upgrading a client's auto policy.Answer
  2. B
    A salaried mailroom clerk who distributes generic marketing flyers to local businesses.
  3. C
    A human resources manager who explains the company's group health plan to new employees.
  4. D
    An administrative assistant who solely schedules client meetings for the agency's primary broker.

Answer

The customer service representative who earns a commission for upgrading a client's auto policy.
The correct answer correctly identifies that upgrading a policy and receiving a commission constitutes selling insurance. State laws mandate that any individual who sells, solicits, or negotiates insurance contracts for a commission must hold an active producer license.

Step-by-Step Solution

1
Analyze each individual's role to determine if they are engaging in selling, soliciting, or negotiating insurance.
The mailroom clerk, HR manager, and administrative assistant perform clerical or administrative tasks. The customer service representative actively upgrades policies.
State laws require a license for active insurance transactions, not for clerical support.
2
Evaluate the compensation structure for each role.
Only the customer service representative receives a commission based on an insurance transaction.
Receiving a commission tied to the sale of an insurance product is a definitive trigger for licensing requirements.

Key Concept

Licensing Exemptions for Clerical and Administrative Staff
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Topics

Licensing Requirements and Types

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