This post is part of a series sponsored by AgentSync.
You and your bestie booked a once-in-a-lifetime cross-country train trip to celebrate your biggest professional accomplishment to date. What could go wrong? Sadly, an emergency appendectomy derails your plans two days before your departure. Good thing you had travel insurance!
However, the casual observer likely doesn’t understand that under that travel insurance policy lies an entire network of people and agencies and carriers, all responsible for delivering this protection to interested consumers. And under that network is a layer of regulation that shapes how those businesses get licenses, relate to each other, and ultimately deliver contracts to consumers.
While a life insurance license or a property and casualty insurance license may be fairly straightforward across the states, travel has many variations that make state reciprocity a tricky proposition. Here, we’ve listed some of the common variations we see between state regulation of travel insurance licenses.
1. Some states simply don’t require producers or agencies to have a travel license
The first variation on the travel lines theme that makes reciprocity tricky is that some states don’t require any kind of license to sell travel insurance. In these states, travel insurance may not even be regulated by the state department of insurance but may be viewed more as a product warranty.
Some states don’t require a travel retail agency or their sales people to have insurance licenses but do require them to operate under the supervision of an agency that has an appropriate travel license. Or maybe a property and casualty (P&C) license. Or maybe the travel retail agency can sell travel insurance without a license as long as the coverage is part of a travel package, but never as a standalone product.
This variation even within a single state gets a little chaotic, and it inevitably makes reciprocity awkward in the states that do require some kind of licensing.
2. Some states include your travel license under other major licenses
Many states allow producers with P&C licenses to sell travel insurance under the P&C line of authority. And some states allow anyone with a major lines license – property, casualty, life, or health – to sell travel insurance as long as they have proper training from the carrier.
The states that include travel lines under other major lines of authority often have exceptions that are very specific about whether their travel license structure applies to producers, to agencies, to third-party administrators, or to any combination of these businesses and people.
As you might guess, this, too, makes figuring out state reciprocity a teeny bit hellacious.
3. You can forego getting an appointment for travel in some states if you have a P&C license
In some states, if your ability to sell travel insurance stems from a P&C license, then the travel insurance carriers you’re selling for can skip appointing you for travel. Pretty swanky discount for your travel carriers, although you’ll still need P&C appointments for relevant carriers.
4. Some states require you to have a special limited lines travel license separate from other licenses
Many states require producers to have a specific limited lines travel license in order to sell travel insurance. As we’ve said, reciprocity gets tricky for travel lines, and this is one reason.
At least one state also encourages producers to use its travel license as a designated home state (DHS) license to make reciprocity easier.
Some states that require a limited lines travel license will grant one to a nonresident whose state includes travel sales under a P&C or other major lines license. Sometimes this requires a producer’s resident state DOI to submit proof that the state includes travel under a major lines license. And sometimes this requires producers to take a special path to apply …
5. Remember paper license applications? * Laughs in insurance compliance *
In the case where a producer is applying for a nonresident state that has a travel lines limited license and that producer’s resident state holds travel under a major lines license, the nonresident state might require the producer to submit a paper application. There are at least three states where this is currently true: Alaska, Colorado, and New Mexico.
6. Producer license reciprocity for travel lines licenses gets freaky
As you may have surmised thanks to the “Is it a P&C sublicense? Is it a limited lines license? Is it something anyone with a major lines license should be able to sell?”, producer licensing for anyone who wants to sell travel insurance across state lines is complicated.
Some states make it easy. Some states don’t.
Take the pain out of travel licensing with AgentSync Manage
Do you know how we know all these crazy variations? It’s because we did the hard work of mapping out how travel lines licensure works across the different states, and how a producer or agency can get reciprocity. And now all that handy data is mapped in our Manage product.
What that means for agencies and carriers that sell travel insurance is that AgentSync can take applying for nonresident licenses across state lines from being a manual and tedious process to having streamlined reciprocity data built in. By using our proprietary line of authority mapping in conjunction with data from the National Insurance Producer Registry (NIPR), you can maintain a complete picture of your producers across all lines of business and all states you’re working in.
To see how AgentSync can transform your travel license compliance and producer management, request a travel-lines-specific demo today.
Interested in Travel?
Get automatic alerts for this topic.
