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 397 of 2021, by establishing curricula for courses of
instruction required to be completed by applicants seeking insurance producer
and adjuster 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, Act 534 of 1983, as
amended and codified §§
23-64-201
§
23-64-501 and §
23-64-202(b)(2),
as amended by 397 of 2021.
SECTION
3. APPLICABILITY AND SCOPE
a.
Applicability.
1. 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.
2. This Rule shall also apply to:
A. All applicants seeking a license as an
insurance adjuster;
B. All
applicants seeking a license as a health maintenance organization ("HMO")
producer, or as a producer for a limited benefit health maintenance
organizations 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;
C. All applicants
seeking a license as a fraternal benefit society producer, except those
specifically exempted pursuant to the provisions of Arkansas law;
D. All applicants seeking a license as a
producer for a hospital or medical service corporation; and
E. All applicants who are producers or
adjusters from another state, and who are not licensed as a producer or
adjuster under the Producer License Model Act, shall be required to comply with
this Rule in order to secure any new resident or nonresident producer or
adjuster license.
b. Exemptions. The following are exempt from
this Rule:
1. Insurance consultants, pursuant
to Ark. Code Ann. §
23-64-202(b)
(2)(A)(iii)(d);
2. Surplus line brokers licensed pursuant to
Ark. Code Ann. §
23-65-301, and Department Rule 24,
and exempted pursuant to Ark. Code Ann. §
23-64-501(c);
3. Applicants licensed as a producer or
adjuster 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
or adjuster license;
4. Applicants
for an adjuster license holding a current certification issued by a national or
state claims association that is a continuing education provider approved by
the Commissioner.
SECTION
4. EFFECTIVE DATE
This Rule shall be effective February 14, 2022.
SECTION 5. COURSE REQUIREMENTS
a.
1. All
applicants for an Arkansas 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:
|
A.
|
Introduction to Insurance
|
1 hour
|
|
B.
|
State Insurance Laws and Rules
|
5 hours
|
|
C.
|
Life Insurance Basics
|
5 hours
|
|
D.
|
Life Insurance Policies, Policy Options, and Policy
Provisions
|
5 hours
|
|
E.
|
Annuity Contracts
|
3 hours
|
|
F.
|
Ethics
|
1 hour
|
2. All
applicants for an Arkansas accident and health or 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:
|
A.
|
Introduction to Insurance
|
1 hour
|
|
B.
|
State Insurance Laws and Rules
|
5 hours
|
|
C.
|
Health Insurance Policy provisions
|
3 hours
|
|
D.
|
Disability Income Insurance
|
2 hours
|
|
E.
|
Medical Expense Insurance
|
1 hour
|
|
F.
|
Medicare Supplement Insurance
|
1 hour
|
|
G.
|
Long Tenn Care
|
2 hours
|
|
H.
|
Social Security and Medicare
|
2 hours
|
|
1.
|
Group Insurance
|
1 hour
|
|
J.
|
Health Maintenance Organizations
|
1 hour
|
|
K.
|
Ethics
|
1 hour
|
3. 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:
|
A.
|
Introduction to Insurance
|
1 hour
|
|
B.
|
State Insurance Laws and Rules
|
5 hours
|
|
C.
|
Ocean (Wet Marine) and Inland Marine
Insurance
|
1 hour
|
|
D.
|
General Liability Insurance
|
2 hours
|
|
E.
|
Automobile Insurance and Assigned Risk Plans, including
Personal j'AIPSO") and Commercial ("CAIP")
|
5 hours
|
|
F.
|
Workers' Compensation and Assigned Risk
Plan
|
3 hours
|
|
G.
|
Commercial Crime Insurance and Fidelity
Bonds
|
1 hour
|
|
H.
|
Surety Bonds
|
1 hour
|
|
I.
|
Ethics
|
1 hour
|
4. 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:
|
A.
|
Introduction to Insurance
|
1 hour
|
|
B.
|
State Insurance Laws and Rules
|
5 hours
|
|
C.
|
Fire and Allied Lines; and Assigned Risk Plans
("ARRUA") and Arkansas Earthquake Authority ("AEA")
|
4 hours
|
|
D.
|
Homeowners Policies and Other Multiple-Line
Products
|
5 hours
|
|
E.
|
National Flood Insurance-Federal
|
0.5 hour
|
|
F.
|
Commercial Property and Commercial Crime
Insurance
|
3 hours
|
|
G.
|
Crop Insurance - FEDERAL ("FCIC")
|
0.5 hour
|
|
H.
|
Ethics
|
1 hour
|
5. 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:
|
A.
|
Introduction to Insurance
|
1 hour
|
|
B.
|
State Insurance Laws and Rules
|
5 hours
|
|
C.
|
Fire and Allied Lines; including Manufactured Houses;
and Assigned Risk ("ARRUA") and Arkansas Earthquake Authority
("AEA")
|
2 hours
|
|
D.
|
Homeowners Policies and Other Multiple-Line Products
and Assigned Risk Plans ("ARRUA") and Arkansas Earthquake Authority
("AEA");
|
5 hours
|
|
E.
|
Automobile Insurance and Assigned Risk
Plans
|
5 hours
|
|
F.
|
Flood Insurance - Federal
|
1 hour
|
|
G.
|
Ethics
|
1 hour
|
6. All
applicants for a property adjuster license 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:
|
A.
|
Insurance Concepts, Risk, Insurable Interest, Loss
Valuation, Market Value, Stated Value, Salvage Value, Deductible, Occurrence,
Negligence, Comparative Fault
|
3 hours
|
|
B.
|
General Adjusting Definitions, Policies, Binders,
Subrogation, Value, Appraisal, Duties of the Insured after a Loss,
1st Party Claimants, 3rd
Party Claimants
|
2.5 hours
|
|
C.
|
General Property Definitions, Policies, Concurrent
Insurance, Actual Cash Value, Replacement Cost, Causation, Proof of
Loss
|
2.5 hours
|
|
D.
|
General Adjusting Practices, Liability, Representation,
Investigation, Duties of the Insurance Company
|
2 hours
|
|
E.
|
Arkansas Property Adjusting, Loss Settlement,
Total/Partial Loss, Coinsurance
|
2 hours
|
|
F.
|
State Insurance Law and Rules
|
5 hours
|
|
G.
|
Unfair Claims Settlement Practices, Unfair Trade
Practices
|
2 hours
|
|
H.
|
Ethics
|
1 hour
|
7. All
applicants for a casualty adjuster license 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:
|
A.
|
Insurance Concepts, Risk, Insurable Interest, Loss
Valuation, Market Value, Stated Value, Salvage Value, Deductible, Occurrence,
Negligence, Comparative Fault
|
3 hours
|
|
B.
|
General Adjusting Definitions, Policies, Binders,
Subrogation, Value, Appraisal, Duties of the Insured after a Loss, Proof of
Loss, 1st Party Claimants, 3
rd Party
Claimants
|
3 hours
|
|
C.
|
General Property Definitions, Policies, Concurrent
Insurance, Actual Cash Value, Replacement Cost, Causation
|
2 hours
|
|
D.
|
General Adjusting Practices, Liability, Representation,
Investigation, Duties of the Insurance Company
|
2 hours
|
|
E.
|
Arkansas Property Adjusting, Loss Settlement,
Total/Partial Loss, Coinsurance
|
2 hours
|
|
F.
|
State Insurance Laws and Rules
|
5 hours
|
|
G.
|
Unfair Claims Settlement Practices, Unfair Trade
Practices
|
2 hours
|
|
H.
|
Ethics
|
1 hour
|
8. All
applicants for a worker's compensation insurance adjuster license 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:
|
A.
|
Insurance Concepts, Risk, Insurable Interest, Loss
Valuation, Market Value, Stated Value, Salvage Value, Deductible, Occurrence,
Negligence, Comparative Fault
|
2 hours
|
|
B.
|
General Adjusting Definitions, Policies, Binders,
Subrogation, Duties of the Insured after a Loss, Proof of Loss.
|
2 hours
|
|
C.
|
General Worker's Compensation Definitions, Causation,
Bodily Injury, Prior Injury, Statements, Burden of Proof, Waivers, Employee,
Employer, Independent Contractor, Certificate of Non-Insurance, Waiting
Period
|
2 hours
|
|
D.
|
General Adjusting Practices, Liability, Covered Claim,
Representation, Investigation, Duties of the Insurance Company
|
3 hours
|
|
E.
|
Arkansas Worker's Compensation Adjusting, Arkansas
Worker's Compensation Commission, Wage Determinations, Hearing, Medical
Examinations, Settlements and Awards
|
3 hours
|
|
F.
|
State Insurance Laws and Rule
|
5 hours
|
|
G.
|
Unfair Claims Settlement Practices, Unfair Trade
Practices
|
2 hours
|
|
H.
|
Ethics
|
1 hour
|
b. EXCEPTIONS.
1. Notwithstanding the provisions of
Subsection (a) above, an applicant for a new license or additional line of
authority shall be exempt from the five (5) hours of State Insurance Laws and
Rules portion for:
A. Life
B. Accident/Health/Sickness
C. Casualty
D. Property
E. Personal Lines (non-commercial)
F. Property Adjuster
G. Casualty Adjuster
H. Worker's Compensation Adjuster
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 license or additional line of authority. This exemption
or waiver is provided by Ark. Code Ann. §
23-64-202.
2. Notwithstanding the provisions
of Subsection (a) above, an applicant for a new license or additional line of
authority shall be exempt from the one (1) hour of Ethics course for:
A. Life
B. Accident/Health/Sickness
C. Casualty
D. Property
E. Personal Lines (non-commercial)
F. Property Adjuster
G. Casualty Adjuster
H. Worker's Compensation Adjuster
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 license or additional line of authority.
3.
A. Subsections (a) and (b) 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 satisfactoiy 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 friends
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
will be approved as an instructor/proctor who has received disciplinary action
by the Arkansas Insurance Department, the Insurance Department of another
state, 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 or to improve a provider's passfail 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 their
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:
1.
Detailed description of the classroom or electronic course instruction program,
including a course outline and list of resource materials.
2. Completion of Appendix 1 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 training, 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 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. The following forms are available via the
Department's website at
https://insurance.arkansas.gov/pages/industry-regulation/licensing/fcrms-instructions/
or by contacting the Licensing Division at 501-371-2750.
|
i.
|
Appendix 1
|
Application for Approval as Course Provider
|
|
ii.
|
Appendix 2
|
Change in Curriculum or Instructor or
Proctor
|
|
iii.
|
Appendix 3(A)
|
Life
|
|
iv.
|
Appendix 3(B)
|
Accident and Health or Sickness
|
|
v.
|
Appendix 3(C)
|
Casualty
|
|
vi.
|
Appendix 3(D)
|
Property
|
|
vii.
|
Appendix 3(E)
|
Personal Lines (Non-Commercial)
|
|
viii.
|
Appendix 3(F)
|
Property Adjuster
|
|
ix.
|
Appendix 3(G)
|
Casualty Adjuster
|
|
x.
|
Appendix 3(H)
|
Worker's Compensation Adjuster
|
|
xi.
|
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 or
substantially similar forms as approved by the Commissioner.
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(H), as found on the Department's
website,
https://insurance.arkansas.gov/pages/industi-v-regulation/licensing/forms-instructions/,
to give to the course attendee or applicant. The Certificate must include the
type and length of study (either by live classroom instruction or by electronic
media) selected by the course provider.
d. The
individual original certification or electronic copy 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 or electronic copy
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 by mail or
electronically 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.
