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The National Association of Insurance Commissioners' Producer Licensing Model Act is intended to serve as a model for uniformity in insurance producer licensing throughout all U.S. jurisdictions. The model, adopted by the Market Conduct and Consumer Affairs (EX3) Subcommittee on Oct. 6, 1999, is expected to be adopted by the NAIC by the time this appears in print. Once adopted, it will replace the Agents and Brokers Licensing Model Act and the Single License Procedure Model Act. Rules governing both procedures and producer qualifications for licensure will be streamlined, and the statutory language will be simplified and codified to improve efficiency, permit the use of new technology, and reduce costs associated with issuing and renewing both resident and nonresident insurance producer licenses.
The model codifies the definitions of the three core activities requiring licensure-selling, solicitation and negotiation. "Sell" means to exchange a contract of insurance for money or its equivalent on behalf of an insurance company, "solicit" means attempting to sell insurance or asking or urging a person to apply for a particular kind of insurance from a particular company; and "negotiate" means conferring directly with, or offering advice directly to, a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms or conditions of the contract, provided that the person engaged in that act either sells insurance or obtains insurance from insurers for purchasers. The model then says "A person shall not sell, solicit or negotiate insurance in this state for any class or...