Each issue, Claims CE will provide several continuing education-based questions designed to test claim professionals on their knowledge of a particular topic. This is in an effort to help educate and inform adjusters and supervisors on appropriate claim-handling techniques. For this edition, we take a look at Adjuster Licensing.

The question-and-answer format is meant to be general in nature and does not necessarily account for the differences in law and practice in different venues. The authors of this question-answer column are not attorneys; content should not be construed as legal advice for the unique circumstances of any particular claim.

Please note: More than one answer may apply.

Question #1

Brad holds an active license in his own state. Due to company expansion, his claim manager asks him to begin handling claims in a neighboring state that does not have any reciprocal licensing laws. What should Brad do in order to be qualified to adjust claims in the new state?

a. Get his manager to reconsider. Because of the potential for confusion between the laws of different states, most departments of insurance strongly recommend that adjuster licensure be limited to one state. Exceptions are not necessarily uncommon but are technically given only in cases of extreme need.

b. Nothing. Adjusters may handle claims in other states as long as they are properly licensed in their home states. Reciprocal licensing laws only apply when ethical or disciplinary factors are at issue.

c. Check his educational qualifications. Some states will waive adjuster examination requirements if the applicant has earned certain insurance designations or insurance-related college degrees.

d. Start studying! Educational background has no bearing on adjuster licensure. The adjuster may be required to take a licensure exam to be qualified to handle claims in another state.

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Answer and explanation

Either “c” or “d” could apply.

Many states have reciprocal licensing agreements with other states. In other words, many states accept adjuster licenses from other states without qualification. Usually the payment of a fee is necessary, though.

However, some states do not reciprocate; an applicant for a “non-resident” license would then be required to fulfill additional requirements. These may or may not involve completing required classes and/or a licensing exam.

It is also important to remember that some non-reciprocating states will waive educational or even examination requirements to become licensed if the applicant has earned certain insurance designations or insurance-related college degrees. CPCU or CIC designations will often meet these requirements. The applicable department of insurance should be contacted in order to determine if a reciprocal agreement exists or can be waived.

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Question #2

Meredith has been a licensed claim adjuster for many years. Throughout her career, she has had to complete annual or biennial continuing education requirements to maintain her license. Since she had to successfully pass a state-required examination to establish her competency, why are continuing education classes still necessary?

a. Federal law requires continuing education for all property and casualty adjusters. Differing reasons have been given for the advisability of CE by the National Association of Insurance Commissioners; however, it is the legal requirements laid out in the Insurance Professionals and Continuing Education Act (IPCEA) that have made continuing education mandatory.

b. States have a vested interest in ensuring that all licensed adjusters are informed about any industry changes that might have an impact on their profession, their sponsoring companies, or their clients.

c. States want to expose licensed adjusters to technical knowledge, ethical considerations, and legal concepts beyond the scope of their own professional experience.

d. Some states want to ensure that all licensed adjusters complete a balanced curriculum of continuing education. For example, curriculum requirements may include courses pertaining to ethics, flood claims, or other specific subjects.

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Answer and explanation

The best answer is “b, c, & d.”

Insurance agent and adjuster licensure is not regulated by the federal government (yet). Instead, each state’s department of insurance oversees and enforces insurance licensure law as mandated by that particular state’s legislative body.

Most states usually require that continuing education courses be completed either annually or biennially. There is currently an effort underway by the National Association of Insurance Commissioners to eventually standardize the continuing education requirements across the country; however, some states would likely retain some unique licensure continuing education requirements (particularly for non-resident adjusters).

While many view continuing education as an unfortunate inconvenience, the value of the CE experience is often up to the individual adjuster. Continuing education can be an opportunity to make business connections, complete a designation, broaden skills, or learn more about the local insurance community. Reputable education providers can be invaluable tools to bolster one’s general knowledge, keep abreast of the changing dynamics within the industry, and make sure that CE requirements are met in the most rewarding way possible.

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Question #3

Henry is not certain if he has completed all of his continuing education requirements for the current calendar year. He may have some carryover credits that apply. He also wants to make sure that all of his credit hours have been accurately recorded. How should Henry ensure that he has been given proper credit for his classes?

a. He should contact the American Institute for Chartered Property Casualty Underwriters (AICPCU) for his credit balance and guidance regarding carryover rules.

b. He should contact the education provider that administered or taught his courses. They will be able to confirm the submission of credits and give guidance regarding carryover rules.

c. He should contact his company’s training department or educational facilitator to check on his status. They will be able to confirm the submission of credits and give guidance regarding carryover rules.

d. He should contact his state’s department of insurance to check his credit balance and confirm that all requirements have been satisfied.

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Answer and explanation

The best answer is “d.”

Every agent or adjuster is solely responsible for meeting their own continuing education requirements and ensuring that classes have been properly credited. Ultimately, it will be the adjuster — not the trainer or education provider — who will lose or have his license suspended when educational requirements are not completed, even if it is by accident or oversight!

Generally, each individual department of insurance is responsible for processing and maintaining continuing education credit earned by adjusters and agents licensed in that state. In some cases, these obligations are outsourced to one of several private, national companies that specialize in these duties and take responsibility for them in lieu of the DOI. It is still incumbent upon the license holder, however, to ensure his credits are properly reported.

Educational providers will usually be more than willing to work with license holders who have attended their seminars or classes to ensure their credits are received and successfully processed by the responsible party. If this is not the case, do not seek their services in the future.

Most DOIs also require each licensed agent or adjuster to notify them within a certain period of time when moving or changing mailing addresses. Periodic reminders or other important information regarding new educational requirements or deadlines may be mailed to you, so be sure that correct contact information with the applicable department of insurance is always maintained.

Interested in taking another CE-related quiz? Click here for the last issue’s edition.