Ohio Gov. Signs Agent Licensing Bill

The Ohio Department of Insurance announced that Governor Bob Taft signed Senate Bill 129, legislation crafted to streamline the insurance agent licensing process in Ohio. Sponsored by Senator Scott Nein (R-Middletown), ODI stated that the bill is an essential part of Ohio Insurance Director Lee Covington’s program to improve services to agents.

“This legislation is a crucial component of achieving our mission to improve services to one of the Department’s most important constituencies ¾ licensed insurance agents and prospective new insurance agents in Ohio and across the country,” Covington said.

Ohio was one of two original pilot states for the National Insurance Producer Registry (NIPR) that allows an agent one-stop nationwide licensing through a state-of-the-art system. Ohio was also one of the first states to use the Producer Database (PDB) to verify home state licensing rather than requiring a paper home state certification from a non-resident application.

“Senate Bill 129 streamlines the agent licensing system for non-resident agents,” Covington said. “It has become obvious in recent years that insurance agents operate across state lines. This legislation will help insurance agents licensed in Ohio and other states to more easily acquire their agent licenses across the country in states that have adopted this model. It will enable Ohio agents to become licensed in multiple states literally with the touch of a button.”

This legislation adds to the Department’s efforts to provide the highest level of service to insurance agents which includes:

1. New Agent Licensing System allowing agents to be licensed in as few as five business days. By using this system, agents can:

Apply online;

Complete fingerprinting and background checks through an electronic system that produces results in 24 hours (approximately 75 percent of the 12,000 new agents are electronically fingerprinted);

Schedule exams online;

Take a “sample” exam on-line to get comfortable with the format;

Take the test using state-of-the-art computer testing facilities;

Obtain the test results and license (if successful) immediately upon completing the exam; and

Complete the appointment process via the Internet on a same day basis. Nearly 75 percent of the 250,000 new agent appointments are processed on line, which is up from 50 percent in 2000.

2. Online, interactive continuing education course for licensed agents available 24 hours a day, seven days per week.

3. Online, home state license verification through the National Producer Database.

4. New “Agent Update” newsletter and a CE transcript delivered twice a year, and available via e-mail, to improve communications with agents and provide more services.

5. New certificate of licensure for licensed agents in Ohio that reflects the accomplishment and professionalism of Ohio agents.

Senate Bill 129 also makes Ohio compliant with the provisions of the federal financial services modernization act of 1999, known as the Gramm-Leach-Bliley Act (GLBA). GLBA, adopted in November 1999, requires that states adopt full reciprocity provision for agent licensing to avoid the creation of a quasi-federal organization, the National Association of Registered Brokers and Agents. GLBA required that a minimum of 29 states adopt reciprocity provisions by November 2002.

In addition, the bill incorporates the National Association of Insurance Commissioners’ (NAIC) Producer Licensing Model and the NAIC Safe Harbors model, making Ohio the 40th state to adopt reciprocity provisions and one of the first states to codify the Safe Harbors model that regulates the sale of insurance by banks and other lending institutions.

With the passage of GLBA and the elimination of barriers between banks and insurance companies, banks and other organizations will proactively pursue customers who want to purchase insurance products. The statutory regulations included in SB 129 are designed to ensure the consumer is fully educated regarding the choices they have when purchasing insurance from these companies.

Topics Agencies Legislation Ohio