With over a year remaining on the November 2002 deadline, 25 state legislatures have enacted reciprocal producer licensing laws while bills in another 11 states are awaiting the governors’ signatures.
The producer licensing legislation passing in states around the country includes reciprocity provisions that satisfy the federal Gramm/Leach/Bliley Act (GLBA). The GLBA requires 29 states to pass uniform or reciprocal licensing laws for insurance producers or face federal oversight of producer licensing through the National Association of Registered Agents and Brokers (NARAB).
Most states have opted to enact legislation that closely mirrors the National Association of Insurance Commissioners’ (NAIC) model act, which includes reciprocity provisions that preserve state regulation of insurance while streamlining the agent and broker licensing process. Reciprocity requirements under the federal act mandate that a licensed agent or broker in good standing in his or her home state should be automatically granted nonresident licenses by other states.
States that now have GLBA-acceptable statutes in place are: Alabama, Arizona, Arkansas, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Minnesota, Mississippi, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Virginia, Washington and Wyoming. Kentucky and New Mexico passed GLBA compliant producer licensing laws in 2000.
Bills in eleven other states that now await their governors’ signatures include: Arkansas, Colorado, Connecticut, Hawaii, Illinois, Louisiana, Missouri, New Hampshire, Nevada, North Carolina, and Texas.
The NAIC has expressed concern that some of the largest states have not passed producer licensing legislation suggesting that the effectiveness of the reciprocity among states could be diminished.
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