2005 California Insurance Code Sections 1749-1749.9 Article 13.5. Prelicensing and Continuing Education

1749.  The department shall require all new applicants for license
as a fire and casualty broker-agent, personal lines broker-agent, or
as a life agent to meet prelicensing education standards as follows:
   (a) Require a minimum of 40 hours of prelicensing classroom study
as a prerequisite to qualification for a fire and casualty
broker-agent license.  The curriculum for satisfying this requirement
shall be approved by the curriculum board and submitted to the
commissioner for final approval.  Any additions to the minimum
requirements provided by this section shall be approved by the
curriculum board pursuant to Section 1749.1 and certified by the
department.
   (b) Require a minimum of 20 hours of prelicensing classroom study
as a prerequisite for qualification for a personal lines broker-agent
license.  The curriculum for satisfying this requirement shall be
approved by the curriculum board and submitted to the commissioner
for final approval.  Any additions to the minimum requirements
provided by this section shall be approved by the curriculum board
pursuant to Section 1749.1 and certified by the department.
   (c) Require a minimum of 40 hours of prelicensing classroom study
as a prerequisite for qualification for a life agent license.  The
curriculum for satisfying this requirement shall be approved by the
curriculum board and submitted to the commissioner for final
approval.  Any additions to the minimum requirements provided by this
section shall be approved by the curriculum board pursuant to
Section 1749.1 and certified by the department.  This curriculum
shall also include instruction in workers' compensation and general
principles of employers' liability.
   (d) In addition to the 40 hours prelicensing education required to
qualify for a license as a fire and casualty broker-agent or life
agent, or the 20 hours prelicensing education required to qualify for
a license as a personal lines broker-agent, the department shall
require 12 hours of study on ethics and this code.  Where an
applicant seeks a license for both the fire and casualty broker-agent
license and the life license, the applicant shall only be required
to complete one 12-hour course on ethics and this code.  The
curriculum for satisfying this requirement shall be approved by the
curriculum board and submitted to the commissioner for final
approval.
   (e) An applicant for a life agent license, a fire and casualty
broker-agent license, or a personal lines broker-agent license who is
currently licensed as such in another state and who has completed 40
hours of prelicensing education as a requirement for licensing in
that state shall be required to complete only the course of study on
ethics and the Insurance Code, as required by Section 1749.
Additionally, any applicant for such a license holding one or more of
the designations specified in subdivisions (a) to (e), inclusive, of
Section 1749.4 shall be exempted from any requirement for courses in
general insurance that would otherwise be a condition of issuance of
the license.
   (f) An applicant for a fire and casualty broker-agent license who
is licensed as a personal lines agent shall complete a minimum of 20
hours prelicensing classroom study as a prerequisite.  The curriculum
for satisfying this requirement shall be approved by the curriculum
board and submitted to the commissioner for final approval.  The
applicant shall not be required to repeat any prelicensing
requirements completed as a prerequisite to being licensed as a
personal lines agent.
1749.01.  Sections 1749 and 1749.3 shall not apply to a life agent
who is limited by the terms of a written agreement with the insurer,
which filed on that life agent's behalf a notice of appointment with
the commissioner, to transact only specific life insurance policies
or annuities having an initial face amount of fifteen thousand
dollars ($15,000) or less that are designated by the purchaser for
the payment of funeral and burial expenses.  The commissioner may
require the insurer appointing those life agents to certify as to the
limitations of the agents' representation.
1749.02.  "Twenty-four hour coverage" is the joint issuance of a
workers' compensation policy with a disability insurance policy,
health care service plan contract, or other medical insurance
coverage for nonoccupational injuries and illnesses.  This product
shall not include a life insurance policy.
1749.1.  (a) The commissioner shall appoint a curriculum board
consisting of representatives of insurance agents, brokers, and life
agents trade associations and representatives of insurance companies
and consumer groups to develop the prelicensing and continuing
education curriculum, including a list of preapproved courses of
study, including courses of study for professional designations which
would satisfy the requirements of this article.  The curriculum
board shall develop or recommend courses of study covering all lines
of insurance to be sold under each license including, but not limited
to, any special products such as long-term care insurance, Medi-gap
policies, disability insurance products, and course study on ethics
and pertinent sections of this code.  The curriculum developed and
the courses of study approved by the board shall be submitted to the
commissioner for final approval.
   (b) The curriculum board shall also develop standards for
providers and instructors of prelicensing and continuing education
courses, programs, and seminars, which standards shall be approved by
the board and submitted to the commissioner for final approval.
   (c) Whenever the commissioner has reasonable cause to believe, and
determines after public hearing, that any approved course, program
of instruction, or seminar is being conducted so as to fail to meet
the commissioner's prelicensing or continuing education curriculum,
or any provider or instructor for any course, program, or seminar has
failed to comply with the commissioner's standards, the commissioner
may make and serve upon the provider or instructor of that course,
program, or seminar an order or orders rescinding approval for that
provider, course, program, or seminar, or imposing fines and
penalties on that provider, or both.  The amount of any fines and
penalties shall not exceed the amounts set forth in Section 1748, and
shall be based on the criteria for assessing penalties specified in
that section.  No credit towards meeting the requirements of this
article shall be granted any applicant or licensee for completion of
a course, program, or seminar after the effective date of any order
rescinding approval for that course, program, or seminar.  The
commissioner shall serve notice of hearing required by this section
upon the provider or instructor of the course, program, or seminar,
stating the time and place therefor, and the grounds upon which his
or her order is made.  The hearing shall occur not less than 30 nor
more than 60 days after notice is served.
   (d) The commissioner may impose monetary penalties for minor
instances of noncompliance with the standards established pursuant to
this article, such as late course roster submissions and late course
presentation schedules.  The monetary penalties shall not exceed the
amounts of the fees established pursuant to Section 1751.1.  The
commissioner shall adopt regulations to establish the monetary
penalties to be levied against providers for late filings and other
minor instances of noncompliance with this article and Article 6.5 of
Subchapter 1 of Chapter 5 of Title 10 of the California Code of
Regulations.
1749.2.  The purpose of Sections 1749.3 to 1749.6, inclusive, is to
establish requirements and standards for continuing education
programs for persons licensed as fire and casualty broker-agents and
life agents.
   Sections 1749.3 to 1749.6, inclusive, shall not apply to either
(a) those persons holding  resident licenses for any kind or kinds of
insurance for which an examination is not required by the law of
this state, nor shall it apply to any such limited or restricted
license as the commissioner may exempt or (b) licensed nonresident
agents or brokers who comply with the continuing education
requirements of their state of residence.
1749.3.  An individual licensed as either a life agent or a fire and
casualty broker-agent, but not as both, shall complete those
courses, programs of instruction, or seminars approved by the
commissioner for the type of license held.  The minimum number of
hours required is as follows:
   (a) During each of the first four 12-month periods following the
date of the original license issuance, a minimum of 25 hours.
   (b) Any licensee who has held a license prior to the effective
date of this section, or who has complied with subdivision (a), shall
satisfactorily complete 30 hours of instruction prior to renewal of
the license.  These hours of instruction may be completed at any time
prior to renewal of the license.
   (c) An individual licensed as both a fire and casualty
broker-agent and as a life agent shall satisfy the requirements of
this section by demonstrating completion of the courses, programs of
instruction, or seminars approved by the commissioner for either
license.
   (d) Any life agent who wishes to sell 24-hour care coverage, as
defined in Section 1749.02, shall complete a course, program of
instruction, or seminar of an approved continuing education provider
on workers' compensation and general principles of employer
liability, which shall be completed by examination approved by the
commissioner as part of the continuing education course, program of
instruction, or seminar prior to selling this coverage.  The required
number of instruction hours shall be equal to but no greater than
that required by the curriculum board for the prelicensing
requirements of a fire and casualty broker-agent on these subjects.
This requirement shall be part of, and not in addition to, the
continuing education requirement of this section.  Nothing in this
section shall be deemed to allow a life agent to satisfy the
obligations set forth in this section by other than a proctored
examination administered or approved by the department.
   (e) A licensee shall not be required to comply with the
requirements of this article if the licensee submits proof
satisfactory to the commissioner that he or she has been a licensee
in good standing for 30 continuous years in this state and is 70
years of age or older.
1749.31.  An individual licensed as a personal lines broker-agent
shall complete required continuing education courses, programs of
instruction, or seminars approved by the commissioner.  The minimum
number of hours required is 10 hours during each of the calendar
years in a license term prior to the renewal of the license.
1749.4.  The courses or programs of instruction successfully
completed that shall be deemed to meet the standards for continuing
educational requirements, and the number of classroom hours for which
they are equivalent, are as follows:
   (a) Any part of the Life Underwriter Training Council Life Course
Curriculum totaling 50 hours, including the health course totaling 26
hours.
   (b) Any part of the American College CLU diploma curriculum
totaling 30 hours.
   (c) Any part of the Insurance Institute of America's Accredited
Advisor in Insurance (AAI) program totaling 25 hours.
   (d) Any part of the American Institute of Property and Liability
Underwriters' Chartered Property Casualty Underwriter (CPCU)
professional designation program totaling 30 hours.
   (e) Any part of the Certified Insurance Counselor program totaling
25 hours.
   (f) Any insurance-related course approved by the curriculum board
and the commissioner taught by an accredited college or university
per credit hour granted totaling 15 hours.
   (g) Any course or program of instruction or seminar developed or
sponsored by an authorized insurer, recognized agents' association,
or insurance trade association, or any independent program of
instruction shall, if approved by the curriculum board and the
commissioner, qualify for the equivalency of the number of classroom
hours assigned thereto by the curriculum board and the commissioner.
   (h) Any correspondence course approved by the curriculum board and
the commissioner shall qualify for the equivalency of the number of
classroom hours assigned thereto by the commissioner.
1749.5.  (a) A person teaching any approved course of instruction or
lecturing at any approved seminar shall qualify for the same number
of classroom hours as would be granted to a person taking and
successfully completing that course, seminar, or program, except that
such person shall qualify for those classroom hours only once each
license term for each course, seminar, or program.
   (b) Excess classroom hours accumulated during any one-year period
may be carried forward to the next year.
   (c) For good cause shown, the commissioner may grant an extension
of time during which the requirements imposed by this article may be
completed, but that extension of time shall not exceed the period of
one year.
   (d) Every person subject to this article shall furnish, in a form
satisfactory to the commissioner, written certification as to the
courses, programs, or seminars of instruction taken and successfully
completed by that person.
1749.6.  Any person failing to meet the requirements imposed by
Section 1749.3 or 1749.31, and who has not been granted an extension
of time within which to comply by the commissioner shall have his or
her license automatically terminated until the time that the person
demonstrates to the satisfaction of the commissioner that he or she
has complied with all of the requirements of this article and all
other laws applicable thereto.  Where a person cannot perform the
requirements of this article due to a disability or inactivity due to
special circumstances, the commissioner shall provide a procedure
for the person to place his or her license on inactive status until
the time that the person demonstrates to the satisfaction of the
commissioner that he or she has complied with or made up all of the
requirements of this article for the period of disability or
inactivity.
1749.7.  The commissioner may, pursuant to Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code, adopt reasonable rules and regulations necessary for
the convenient administration of this article.
1749.8.  (a) Effective January 1, 2005, every life agent who sells
annuities shall satisfactorily complete eight hours of training prior
to soliciting individual consumers in order to sell annuities.
   (b) Effective January 1, 2005, every life agent who sells
annuities shall satisfactorily complete four hours of training every
two years prior to license renewal.  For resident agents, this
requirement shall be part of, and not in addition to, the continuing
education requirements of Section 1749.3.
   (c) The training required by this section shall be approved by the
commissioner and shall consist of topics related to annuities, and
California law, regulations, and requirements related to annuities,
prohibited sales practices, the recognition of indicators that a
prospective insured may lack the short-term memory or judgment to
knowingly purchase an insurance product, and fraudulent and unfair
trade practices.  Subject matter determined by the commissioner to be
primarily intended to promote the sale or marketing of annuities
shall not qualify for credit towards the training requirement.  Any
course or seminar that is disapproved under the provisions of this
section shall be presumed invalid for credit towards the training
requirement of this section unless it is approved in writing by the
commissioner.
   (d) The training requirements set forth in this section shall not
apply to nonresident agents representing an insurer that is a direct
response provider.
   For the purposes of this section, "direct response provider" means
an insurer that meets each of the following criteria:
   (1) The insurer does not initiate telephone contact with insureds
or prospective insureds.
   (2) Agents of the insurer speak with insureds and prospective
insureds only by telephone, and at the request of the insureds or
prospective insureds.
   (3) Agents of the insurer are assigned to speak with insureds or
prospective insureds on a random basis, when contacted.
   (4) Agents of the insurer are salaried and do not receive
commissions for sales or referrals.
1749.85.  (a) The curriculum committee shall, in 2006, make
recommendations to the commissioner to instruct fire and casualty
broker-agents and personal lines broker-agents and applicants for
fire and casualty broker-agent and personal lines broker-agent
licenses in proper methods of estimating the replacement value of
structures, and of explaining various levels of coverage under a
homeowners' insurance policy. Each provider of courses based upon
this curriculum shall submit its course content to the commissioner
for approval.
   (b) A person who is not an insurer underwriter or actuary or other
person identified by the insurer, or a licensed fire and casualty
broker-agent, personal lines broker-agent, contractor, or architect
shall not estimate the replacement value of a structure, or explain
various levels of coverage under a homeowners' insurance policy.
1749.9.  Nothing in this article shall require any person exempted
from licensure by Section 1634 or 1635 to hold a license as required
by Section 1631.