6-E LA ADJUSTER LICENSING, COMMISSIONER OF INSURANCE, AND DISCIPLINARY ACTIONS Flashcards
Adjuster: an individual who investigates or adjusts losses on behalf of an insurer as an independent contractor or as an employee of:
● An adjustment bureau ● An association ● A property and casualty producer ● An independent contractor ● An insurer ● A managing general agent
Business entity
a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity.
Home state
the District of Columbia and any state or territory of the United States in which the adjuster’s principal place of residence or principal place of business is located.
In order to get a ____license in Louisiana, an adjuster who lives or works in a state that does not have similar laws to Louisiana regarding adjusters may designate a different home state for licensing purposes.
nonresident
Individual
a natural person.
Insurer
any type of insurer, whether authorized or unauthorized,
conducting business in this state.
Person
an individual or a business entity.
Producer
an individual who is licensed to sell insurance in Louisiana. A producer may be captive, meaning he only works for one insurance company, or independent, selling insurance on behalf of several companies.
Uniform individual application
the current version of the National Association of Insurance Commissioners (NAIC) Uniform Individual Application for resident and nonresident individuals.
Uniform business application
the current version of the National Association of Insurance Commissioners (NAIC) Uniform Business Entity Application for resident and nonresident business entities.
Adjuster Licensing
In Louisiana, any person claiming to be an adjuster or engaging in the practice of adjusting insurance losses must have an adjuster license.
Adjuster licensing
Claims adjusters:
Claims adjusters:
● Represent insurer in the claim process ● Six types: ○ automobile adjuster ○ personal lines adjuster ○ commercial lines adjuster ○ crop adjuster ○ workers’ compensation adjuster ○ property and casualty adjuster (comprehensive adjuster)
Adjuster licensing
Public adjusters:
represent the insured in the claim process
Adjuster licensing
Catastrophe or emergency adjusters:
brought in by insurers temporarily to adjust catastrophe claims
Adjuster licensing
Limited claims adjuster license
● Can be granted by the commissioner
● Only gives the authority to handle certain types of insurance
Adjuster licensing
Temporary/catastrophe adjuster permit
● Commissioner can grant temporary licenses to adjust catastrophe-related
claims in LA for 180 days (with 90-day extension possible)
● $25 fee
● Required before catastrophe adjusters begin working in the state
In order to get a resident adjuster license in Louisiana, a person must meet these requirements:
● Be able to designate Louisiana as home state, or be a resident of a state that does not license adjusters
● Have a record with no grounds for denial, suspension, or revocation of a license in Louisiana
● Submit the proper licensing application and $55 fee
● Keep an office in home state that is accessible to the public
● Report any convictions of a felony, and, when applicable, acquire 18 USC 1033
written consent by the Commissioner of Insurance
● Provide all documentation needed to verify the details in the application
● If an individual (i.e. not a business), the applicant must also:
○ be at least 18 years old
○ pass the Louisiana Adjuster Exam (or qualify for one of the exemptions)
○ be fingerprinted for a background check
● If a business entity, the applicant must also:
○ designate a licensed individual to be in charge of staying in compliance
with insurance laws and regulations
○ only allow licensed individuals to use the business’ license
Someone who lives in another state can get a Louisiana nonresident adjuster license by meeting these requirements:
● Hold (and maintain) a resident adjuster license in good standing in home state
● If home state does not require an exam for licensure, pass the Louisiana
Adjuster Exam
● Submit the proper licensing application and $55 fee
● Live in a state that offers nonresident adjuster licenses to Louisiana residents
on the same basis
Louisiana can waive the exam requirement for the following applicants:
● Anadjusterlicensedbyexaminationinanotherstatewhomovesto Louisiana and applies for a resident license within 90 days
○ thisexemptiononlyappliesifthelicenseewasingoodstanding in the prior state
● ALouisianaresidentwhoheldanadjusterlicensewithinthepast24 months and was in good standing when the license was cancelled ● Anapplicantforaworkers’compensationadjusterlicensewhohas
had 3 years’ experience within the last 5 years
The following people do not need a license to adjust claims in Louisiana:
● An attorney admitted to practice law in Louisiana
● An employee of an insurer who does not regularly adjust or investigate claims
● A person employed only to give an adjuster technical assistance
● A producer of an authorized insurer or employee of said producer, when
processing an uncontested loss under a policy that the producer issued
● A person who performs clerical duties and does not negotiate with parties of
the claim
● An employee of a licensed business entity who collects information about
claims and performs data entry (only 25 such employees are allowed for each
licensed individual adjuster in the business)
● A person who is employed as a right-of-way agent
● A person employed to investigate fraudulent insurance claims but who does
not adjust the claims or determine payment on claims
● A salaried employee of a property owner who represents the property owner’s
interests and:
○ was not hired just to handle a specific claim, or
○ doesn’t advertise himself as an adjuster
● A person who handles claims arising under only:
○ life, accident, and health insurance policies
○ vehicle mechanical breakdown insurance policies
○ property residual value insurance policies
○ commercial policies providing excess coverages as classified by LRS
22:47 (14)
○ reinsurance and subrogation only
License renewal
● Claims adjuster licenses last 2 years and expire on the last day of the
adjuster’s birth month
● Renewal fee: $50
● Reinstatement: allowed within 24 months of expiration with the
commissioner’s permission and double the renewal fee
Continuing education
● 24 hours of CE required for renewal
● 3 hours must be in Ethics
● Exemptions:
○ adjusters who got their licenses less than a year before CE is due
○ non-residents from reciprocal states who meet their home states’ CE
requirements
Reporting
Within 30 days, an adjuster must report:
● Any change of name, address, or any info on the license application (or face a $50 fine or revocation of license)
● Any administrative action taken against him after the final disposition of the matter
● The conviction of any criminal prosecution against him for:
○ violation of insurance laws or regulations
○ felony
○ misdemeanor involving misappropriation of funds
Assumed Names
When doing business under any name that is not legal name:
● Adjuster must register trade name with secretary of state and notify
commissioner before using the trade name
● Fine for using unapproved name: $250 (or up to $5,000 if disobeying order to
stop using that name)
The Louisiana claims adjuster license is a _____ license which expires on the last day of the adjuster’s birth month, either in odd or even years depending on the license number. If the license number ends in an odd number, it will expire in the next odd-numbered year; if it ends in an even number, it will expire in the next even-numbered year.
2-year
In order to become a producer and sell insurance in Louisiana, a person must:
● Be at least 18 years old
● Live in Louisiana
● Take a pre-licensing course, and, for some kinds of insurance, pass an exam
● For bail-bond applicants, work as an apprentice for 3 months
● Submit all necessary forms and fees
● Get fingerprinted
● Report any felony convictions
The Commissioner of Insurance:
● Oversees the licensing and regulation of insurance professionals
● Elected for a 4 year term
● Can appoint a chief deputy commissioner and an assistant
The Commissioner has the authority to:
● Investigate whether anyone in the insurance business has committed illegal,
unfair, or deceptive practices
● Suspend, revoke, or refuse to issue or renew a claims adjuster’s license
● Impose fines: up to $500 for each violation (up to $10,000 in one year)
● Place an adjuster on probation
● Suspend, revoke, or refuse to renew a business’ claims adjuster license if the
business fails to report a violation
An adjuster must also report to the commissioner any criminal prosecution in any jurisdiction for:
● Violation of insurance laws or regulations
● Any felony
●Any misdemeanor involving misappropriation of funds
To renew, you must:
● Filearenewalapplication
● Complete24hoursofContinuingEducationwith3ofthosehours being Ethics
● CEExemptions:
○ adjusterswhogottheirlicenseslessthanayearbeforethedue
date for CE
○ non-residentsfromreciprocalstateswhomeettheirhome
state’s CE requirements
● Payarenewalfeeof$50
● Ifanadjuster’slicenselapses,shemayreinstateitwithin24months by paying double the renewal fee, with the commissioner’s permission
● Anadjusterwhocannotmeetrenewalrequirementsbecauseof military service, disability, or other circumstances may request a waiver of these requirements and any penalties or exams that may result from not meeting them
Change of Name or Address
An adjuster must report any change of name, address, or any info that was on the licensee’s application via NIPR within 30 days to avoid a $50 fine or revocation of license.
Assumed Names
An adjuster who wants to do business under any name other than his legal name must notify the commissioner of the assumed name beforehand.
Reasons for disciplinary actions
- Providing false, misleading, or incomplete information in the license application
- Violating any state insurance law or regulation, or an order of the commissioner
(or of another state’s insurance commissioner) - Obtaining or trying to obtain a license through misrepresentation or fraud,
including cheating on a licensing exam - Improperly withholding, misappropriating, or converting any money or property
received while conducting insurance business - Intentionally misrepresenting the terms of an insurance contract or application
- Being convicted of (or pleading no contest to) a felony, or being convicted of a misdemeanor involving moral turpitude, public corruption, or insurance claims adjusting
- Admitting to or committing fraud or unfair trade practices
- Using fraudulent, coercive, or dishonest practices or demonstrating
incompetence, untrustworthiness, or financial irresponsibility while conducting
business that could endanger the public - Having an insurance license denied, suspended, or revoked in any other state,
province, district, or territory - Forging a name on an application for insurance or any document related to an
insurance transaction - Knowingly accepting insurance business from someone who should be
licensed, but is not - Failing to pay child support
- Failing to pay state income tax
- Refusing to submit fingerprints or undergo a criminal background check 15. Employing, or professionally associating with, someone in the insurance
industry who has been convicted of a felony - Being convicted of a felony involving dishonesty or breach of trust, if the
person has not gotten the commissioner’s written permission to do insurance
business under 18 U.S.C. 1033 - Violating the adjuster standards of conduct
- Failing to complete a claim adjustment assignment in a thorough and timely
manner, including submitting the adjustment to the party that made the assignment
Disciplinary actions
If the commissioner determines that someone has committed illegal or unfair practices, he can:
● Serve a cease and desist order
● Impose a fine:
○ up to $1,000 for each act/violation, up to $100,000
○ for those aware that their actions violated the insurance code: up to
$25,000 for each violation, up to a total of $250,000 in any 6 month
period
● Suspend or revoke the person’s license
Disciplinary actions
Penalty for violating a cease and desist order:
● Fine of up to $25,000 for each violation (maximum of $250,000)
● Suspension or revocation of license or certificate of authority
Examination of insurers and producers
● The commissioner must examine:
○ each insurer at least once every 5 years
○ any given insurer at the request of the Louisiana Insurance Guaranty
Association or the Louisiana Life and Health Insurance Guaranty
Association
Examination of insurers and producers
● The commissioner can examine:
○ any producer when he has received at least 3 complaints within a 30 day period about violations of the insurance code
○ any person, if necessary for the examination of an insurance company`
The Federal Violent Crime Control and Law Enforcement Act
Those convicted of a felony involving dishonesty or breach of trust must get the commissioner’s written consent before engaging in insurance business
● Applicants for licensure must get an application for written consent before applying for licensure
● Anyone already licensed in LA who commits a criminal felony must get permission to continue in insurance business through the Department of Insurance
