LLQP Licensing Requirements 4 — Questions and Answers
Question 1: An agent's life insurance license lapses due to non-renewal. How long does most states allow for reinstatement without retaking the full licensing exam?
- 30 days
- 6 months
- 2 years (Correct answer)
- 5 years
Correct answer: 2 years
Most states allow a 2-year window to reinstate a lapsed license without requiring the agent to retake the full licensing examination.
Question 2: Which of the following activities generally requires a separate Variable Life license in addition to a basic life insurance license?
- Selling term life insurance
- Selling whole life insurance
- Selling variable annuities (Correct answer)
- Selling group life insurance
Correct answer: Selling variable annuities
Variable annuities and variable life products involve securities, requiring agents to hold both a life insurance license and a securities (variable products) license.
Question 3: A licensed agent moves from Texas to California and wants to continue selling life insurance. What must the agent do?
- Apply for a California nonresident license
- Apply for a California resident license within 90 days (Correct answer)
- Continue operating on the Texas license for up to one year
- Register as a foreign agent with FINRA
Correct answer: Apply for a California resident license within 90 days
When an agent relocates their primary residence to a new state, they must apply for a resident license in the new state, typically within 90 days.
Question 4: Which entity is primarily responsible for investigating complaints against licensed insurance agents?
- The FBI Financial Crimes Unit
- The state Department of Insurance (Correct answer)
- FINRA
- The National Association of Insurance Commissioners
Correct answer: The state Department of Insurance
The state Department of Insurance has jurisdiction over licensed agents operating within its state and investigates consumer complaints against them.
Question 5: An agent who sells insurance without a valid license is subject to which of the following consequences?
- A written warning only for the first offense
- Criminal charges and civil penalties (Correct answer)
- Mandatory retraining but no fines
- Automatic licensure by the state
Correct answer: Criminal charges and civil penalties
Selling insurance without a valid license is illegal and can result in criminal charges, civil penalties, and disgorgement of commissions earned.
Question 6: Under the NAIC Producer Licensing Model Act, which of the following is a required disclosure when applying for a life insurance license?
- All prior employment history for the last 20 years
- Any felony convictions and certain misdemeanor convictions (Correct answer)
- Personal net worth and credit score
- Names of all existing policyholders
Correct answer: Any felony convictions and certain misdemeanor convictions
License applicants must disclose criminal history, including felony convictions and certain misdemeanors, as this bears on trustworthiness to hold a license.
Question 7: A life insurance agent wants to be appointed by a second insurer while already appointed by the first. What is generally required?
- Surrender the first appointment before adding the second
- Obtain written consent from the first insurer
- Simply file a new appointment with the state for the second insurer (Correct answer)
- Retake the licensing exam for each new appointment
Correct answer: Simply file a new appointment with the state for the second insurer
Agents may hold multiple appointments simultaneously; each insurer files a separate appointment with the state, and no consent from existing appointers is required.
LLQP Licensing Requirements 4
An agent's life insurance license lapses due to non-renewal.
How long does most states allow for reinstatement without retaking the full licensing exam?