SECTION 1. PURPOSE
The purpose of this Rule ("Rule") is to implement Act 534 of
1983, as amended, and Ark. Code Ann. §
23-64-202(b)(2),
as amended by Act 1948 of 2005, by establishing curricula for courses of
instruction required to be completed by applicants seeking insurance producer
licenses in Arkansas, to establish criteria for approval of course providers of
the courses of instruction, and to establish a mechanism of examination and
review of the performance and quality of the instruction.
SECTION 2. AUTHORITY
This Rule is used pursuant to the authority vested in the
Commissioner under Ark. Code Ann. Sections
23-61-108,
§
23-74-609(a),
§
23-75-102(5),
§
23-76-120(a),
§§
25-15-202,
et seq., and Act 534 of 1983, as amended, and codified as Sections
23-64-201,
et seq., and §§
23-64-501,
et seq.; and §§
23-64-202,
as amended by Act 1948 of 2005.
SECTION
3. APPLICABILITY AND SCOPE
I.
Applicability.
A. This Rule shall apply to
insurance producers, including original license applicants or
currently-licensed applicants seeking an additional line of authority, which
for purposes of this Rule shall be deemed to include all who are referred to
collectively as insurance producers ("producers") under the Producer License
Model Act ("PLMA"), Ark. Code Ann. §§
23-64-501,
et seq.
B. This Rule shall also
apply to:
1. all applicants seeking a license
as an insurance producer;
2. all
applicants seeking a hcense as a health maintenance organization ("HMO")
producer, or as a producer for a limited benefit health maintenance
organization, except those specifically exempted pursuant to the provisions of
Arkansas law. This Rule is intended to complement the provisions of Rule 35,
"Agent License for Health Maintenance Organizations", but is not intended to
supersede it;
3. all applicants
seeking a license as a fraternal benefit society producer, except those
specifically exempted pursuant to the provisions of Arkansas law;
4. all applicants seeking a license as a
producer for a hospital or medical service corporation; and
5. all applicants who are producers from
another state, and who are not licensed as a producer under the Producer
License Model Act, shall be required to comply with this Rule in order to
secure any new resident or non-resident producer license.
II. Exemptions. The following are
exempt from this Rule:
A. insurance adjusters,
pursuant to Ark. Code Ann. §
23-64-202(b)(2)(A)(iii)(d);
B. limited adjusters, pursuant to Ark. Code
Ann. §
23-64-202(b)
(2)(A)(iii)(d);
C. insurance consultants, pursuant to Ark.
Code Ann. §
23-64-202(b)
(2)(A)(iii)(d);
D. surplus line brokers licensed pursuant to
Ark. Code Ann. §§
23-65-301, et
seq., and Department Rule 24, and exempted pursuant to Ark. Code Ann. §
23-64-501(c);
and
E. applicants licensed as a
producer in good standing in another state under the Producer License Model
Act, who thereafter move to Arkansas, who establish residency within the period
required under Arkansas law, and who thereafter apply for a resident producer
license.
SECTION
4. EFFECTIVE DATE
This Rule shall be effective January 1,2016.
SECTION 5. COURSE REQUIREMENTS
I.
A. All
applicants for a life line of authority are hereby required to complete a
course of instruction with a minimum of twenty (20) hours of instruction which
includes, but is not limited to, all of the following, as applicable:
|
1
|
Introduction to Insurance
|
1 hour
|
|
2.
|
State Insurance Laws and Rules
|
5 hours
|
|
3.
|
Life Insurance Basics
|
5 hours
|
|
4.
|
Life Insurance Policies, Policy Options, and Policy
Provisions
|
5 hours
|
|
5.
|
Annuity Contracts
|
3 hours
|
|
6.
|
Ethics
|
1 hour
|
B. All
applicants for an Arkansas accident, health, and sickness (A & H) line of
authority are hereby required to complete a course of instruction with a
minimum of twenty (20) hours of instruction which includes, but is not limited
to, all of the following, as applicable:
|
1.
|
Introduction to Insurance
|
1 hour
|
|
2.
|
State Insurance Laws and Rules
|
5 hours
|
|
3.
|
Health Insurance Policy provisions
|
3 hours
|
|
4.
|
Disability Income Insurance
|
2 hours
|
|
5.
|
Medical Expense Insurance
|
1 hour
|
|
6.
|
Medicare Supplement Insurance
|
1 hour
|
|
7.
|
Long Term Care
|
2 hours
|
|
8.
|
Social Security and Medicare
|
2 hours
|
|
9.
|
Group Insurance
|
1 hour
|
|
10.
|
Health Maintenance Organizations
|
1 hour
|
|
11.
|
Ethics
|
1 hour
|
C. All
applicants for a casualty line of authority are hereby required to complete a
course of instruction with a minimum of twenty (20) hours of instruction which
includes, but is not limited to, all of the following:
|
1.
|
Introduction to Insurance
|
1 hour
|
|
2.
|
State Insurance Laws and Rules
|
5 hours
|
|
3.
|
Ocean (Wet Marine) and Inland Marine Insurance
|
1 hour
|
|
4.
|
General Liability Insurance
|
2 hours
|
|
5.
|
Automobile Insurance and Assigned Risk Plans, including
Personal ("AIPSO") and Commercial ("CAIP")
|
5 hours
|
|
6.
|
Workers' Compensation and Assigned Risk Plan
|
3 hours
|
|
7.
|
Commercial Crime Insurance and Fidelity Bonds
|
1 hour
|
|
8.
|
Surety Bonds
|
1 hour
|
|
9.
|
Ethics
|
1 hour
|
D. All
applicants for a property line of authority are hereby required to complete a
course of instruction with a minimum of twenty (20) hours of instruction which
includes, but is not limited to, all of the following:
|
1.
|
Introduction to Insurance
|
1 hour
|
|
2.
|
State Insurance Laws and Rules
|
5 hours
|
|
3.
|
Fire and Allied Lines; and Assigned Risk Plans
("ARRUA")and Arkansas Earthquake Authority ("AEA")
|
4 hours
|
|
4.
|
Homeowners Policies and Other Multiple-Line
Products
|
5 hours
|
|
5.
|
National Flood Insurance-Federal
|
0.5 hour
|
|
6.
|
Commercial Property and Commercial Crime Insurance
|
3 hours
|
|
7.
|
Crop isurance - FEDERAL ("FCIC")
|
0.5 hour
|
|
8.
|
Ethics
|
1 hour
|
E. All
applicants for a personal line of authority (non-commercial), called "Personal
Lines", are hereby required to complete a course of instruction
with a minimum of twenty (20) hours of instruction which includes, but is not
limited to, all of the following:
|
1.
|
Introduction to Insurance
|
1 hour
|
|
2.
|
State Insurance Laws and Rules
|
5 hours
|
|
3.
|
Fire and Allied Lines; including Manufactured Houses; and
Assigned Risk Plans ("ARRUA") and Arkansas Earthquake Authority ("AEA")
|
2 hours
|
|
4.
|
Homeowners Policies and Other Multiple-Line Products and
Assigned Risk Plans ("ARRUA") and Arkansas Earthquake Authority ("AEA");
|
5 hours
|
|
5.
|
Automobile Insurance and Assigned Risk Plans
|
5 hours
|
|
6.
|
Flood Insurance - Federal
|
Ihour
|
|
7.
|
Ethics
|
1 hour
|
II. EXCEPTIONS.
A. Notwithstanding the provisions of
Subsection (I) above, an applicant for a new or additional line of authority
shall be exempt from the five (5) hours of State Insurance Laws and Rules
portion for:
1. Life
2. Accident/Health/Sickness
3. Casualty
4. Property
5. Personal Lines (non-commercial) if the
applicant has successfully completed this portion of the pre-license education
within two (2) years of the filing date of his application for a new or
additional line of authority. This exemption or waiver is provided by Ark. Code
Aim. §
23-64-202,
as amended by Act 1948 of 2005.
B. Notwithstanding the provisions of
Subsection (I) above, an applicant for a new or additional line of authority
shall be exempt from the one (1) hour of Ethics course for:
1.
IM
2. Accidenl/Health/Sickness
3. Casualty
4. Property
5. Personal Lines (non-commercial) if the
applicant has successfully completed this portion of the pre-license education
within two (2) years of the filing date of his/her application for a new or
additional line of authority.
III.
A.
Subsections I and U of Rule Section 5 apply to both classroom and/or electronic
courses of study.
B. Education
course providers shall file procedures with the Department to illustrate how
the electronic courses may be verified as self-study, and shall detail the
exact length of time that the license applicant spends on the course.
C. For classroom courses, the identity of the
applicant and the length of time spent in that course must be monitored by the
Instructor in the classroom.
SECTION 6. INSTRUCTOR AND ELECTRONIC
EDUCATION INSTRUCTOR/PROCTOR QUALIFICATIONS
A.
1.
Instructors must have had specific insurance training or educational experience
satisfactory to and approved by the State Insurance Commissioner in order to be
certified to teach any part of an approved course. Each instructor must have
three (3) or more years of specific insurance experience and/or education in
each part of the insurance training program in which he/she instructs and must
be approved prior to teaching any course, or any part of a course, by the
Insurance Commissioner.
2.
Individuals who will act as an electronic education instructor/proctor of
electronic education courses must have the same credentials as a classroom
instructor as provided by this Rule.
3. Proctors or instructors must be a
disinterested third party and shall not serve for examinations of: family
members or relatives or dependents, employers or supervisors, employees or
subordinates, partners or joint ventures or co-owners, current or former
teachers or pupils, neighbors or personal fiends or significant others, or for
anyone in whom the proctor or instructor has an economic or other interest in
assuring the successful outcome of the examination.
4. Applicants for approval as a classroom
instructor, or electronics course instructor/proctor shall complete and submit
Appendix 4 to the Arkansas Insurance Department.
B. No person wall be approved as an
instructor/proctor who has received disciplinary action by the Arkansas
Insurance Department, the Insurance Department of another state, or any
regulatory or governmental body, or state or federal court. The Commissioner
shall have the authority to waive this requirement upon written request by the
applicant. The applicant shall have the burden of proving his or her
qualifications to the Commissioner to meet eligibility for serving as an
instructor or proctor.
C. This Rule
prohibits the provider's officials, owners, instructors, or proctors from
taking the licensing exam for the purpose of learning test questions in order
to aid the provider's customers and/or to improve a provider's pass-fail rate.
Any such entity or person discovered to have done this will lose Department
approval to participate in the pre-licensure education program under this Rule,
in addition to any other applicable penalties. An individual who acts as a
proctor may take the exam to obtain an individual producer's license for
his/her own benefit.
D. This Rule
authorizes the Department to compare the end-of-course examinations with
Department examination results at any time, without prior notice to the course
provider, its owners or managers, instructors, or proctors.
SECTION 7. COURSE PROVIDER
REQUIREMENTS
A. Application for approval as a
course provider shall be submitted to the Arkansas Insurance Department not
less than ninety (90) days prior to the expected use of the program. A course
provider shall include the following information in duplicate:
1. Detailed description of the classroom or
electronic course instruction program, including a course outline and list of
resource materials.
2. Completion
of Appendix I for the initial certification; or completion of Appendix 2 upon
any change in curriculum or instructor.
3. Schedule of classes for all
locations.
4. All materials used
for electronic education courses must be made available online to the Arkansas
Insurance Department.
B.
Changes in class schedules are to be filed with the Insurance Department not
later than two (2) weeks before each class begins. Course providers may file in
writing or electronically a change or addition to the class schedule with the
Department one (1) week in advance for a single course scheduled for an
individual.
C. The Commissioner may
consider the type of facility to be used for training, the sufficiency of
teaching aids, and the exclusive use of that portion of the facility being used
for trainings in making a determination to certify the provider.
D. The course provider shall maintain
detailed attendance records for all applicants for all classes for three (3)
years following completion of the classes. Rosters, including courses completed
and completion dates, shall be maintained for a minimum of two (2) years by
course providers. These records may be reviewed by the Commissioner. In this
regard, any studying which is not conducted under the direct supervision of the
classroom instructor at the facility during scheduled classes may not be
credited toward completion of the required twenty (20) hours; and electronic
course providers must verify and confirm to the Department the work done by
electronics course students for proper crediting of electronic hours.
E. Forms. The following forms are prescribed
by the Commissioner and are attached as exhibits to this Rule. All forms are
available upon request to the Department, or via the Department's web site at
http://www.insurance.arkansas.gov/license/divpage.htm.
|
Appendix 1
|
Application for Approval As Course Provider
|
|
Appendix 2
|
Change in Curriculum or Instructor or Proctor
|
|
Appendix 3(A)
|
Life
|
|
Appendix 3(B)
|
Accident, Health, and Sickness
|
|
Appendix 3(C)
|
Casualty
|
|
Appendix 3(D)
|
Property
|
|
Appendix 3(E)
|
Personal Lines (Non-Commercial)
|
|
Appendix 4
|
Application for Approval as Instructor or Proctor
|
F.
Alternate Forms. The Commissioner may accept, in lieu of Appendices 1 - 4 to
the Rule in Item (E) above the most recent editions of comparable forms
published by the National Association of Insurance
Commissioners.
SECTION 8.
PROGRAM REVIEW
The Department shall have the authority to visit a training
facility and review its program at any time, including, but not limited to
curriculum records and attendance records.
SECTION 9. LICENSING PROCEDURE OF APPLICANT
A. The required hours of instruction must be
completed prior to the date of the licensing examination.
B. The instructor or designated official of
the course provider shall complete an original and one (1) copy of each
individual certification. Appendices 3(A) - 3(E), to give to the course
attendee or applicant. The Certificate must include the type and length of
study (either by live classroom instruction and/or by electronic media)
selected by the course provider.
C.
Each individual certification must be on the form as shown in Appendices 3(A)
-3(E) and must be signed by the applicant and the instructor or designated
official of the course provider where more than one instructor is used.
The individual original certification must be presented by the
student to the exam vendor at the time the candidate is scheduled to sit for
the exam. If the candidate fails to present the original certification to the
exam vendor, the candidate will not be allowed to sit for the exam but must
reschedule the exam for another time. The exam vendor will collect all valid
certifications and file those with the Department along with the applications,
fees, or other necessary documents.
SECTION 10. COMPLETION OF COURSE REQUIREMENTS
Educational requirements must be completed no more than two (2)
years prior to taking the license exam for course certification to be
valid.
SECTION 11.
VIOLATIONS
Department approval of instructors and course providers of
instruction courses may be withdrawn for violations of this Rule.
SECTION 12. SEVERABILITY
Any section or provision of this Rule held by a court to be
invalid or unconstitutional will not affect the validity of any other section
or provision of this Rule.
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