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ComplianceJuly 06, 2023

Insurance business license requirements by state

Insurance is a heavily regulated industry with complex requirements. If you plan to work as an insurance agent or broker, or establish an insurance-related business, you must obtain the right license (or multiple licenses) before you can begin to sell products or services. This must be done for every state in which you plan to operate.

Failure to comply with business license laws could result in blocked commissions, fines, and the suspension or revocation of future business licenses. Certain states may also issue cease and desist orders preventing your company from doing business in that state. You may also be required to pay any unpaid customer claims.

With that in mind, let’s look at the questions that arise in this sector related to business license requirements.

What insurance business licenses do I need?

Insurance license requirements vary by state. They also differ depending on the role and insurance type being sold.

To understand what licenses are needed when selling to resident-business entities and non-resident business entities broken down by state, check out our insurance licensing smart chart.

Image of the Insurance business license requirements by state smart chart
Insurance business license requirements by state smart chart
Understand what licenses are needed when selling to resident-business entities and non-resident business entities

How do I determine licensing requirements?

First, consider the states in which you intend to operate. Requirements not only differ by state, but they also vary based on the role an insurance provider plays:

  • Agent/Producer: If you operate as an insurance agent or producer, you are licensed to sell life, health, property, and other forms of insurance. Agents may be independent (self-employed, represent several insurance companies, and are paid on commission) or exclusive or captive agents (represent a single insurance company and are salaried or work on commission).

  • Broker: A broker will represent a consumer and help them find the best insurance policy for their needs at the best price. A broker represents the client, not the insurance companies. To complete the transaction, they will hand over the account to an insurer or agent.

  • Adjuster: An adjuster determines how much an insurance company will pay when a claim is made for property damage or personal injury. They typically inspect the property and vehicle, interview claimants and witnesses, and examine police reports.

Each agent or insurance business must obtain different licenses, and those licenses will differ depending on whether it has resident or non-resident status in the state where you operate.

What are the different types of insurance (lines of authority)?

You may need separate licenses based on the type of insurance you sell. These are the most common types of insurance:

  • Accident and health insurance
  • Bail insurance
  • Life insurance
  • Property and casualty insurance
  • Title insurance
  • Travel insurance

Note: You may need to obtain more than one type of license.

How does the licensing process work?

To obtain an agency license, you must complete an application, include supporting documentation, and pay a fee.

As an agent/producer, you may be asked to provide evidence of your expertise through examinations and continuing education. Because criminal background checks are often conducted prior to licensing, you may also be subject to fingerprinting.

Once you obtain a license, each state will require it to be renewed every one to three years.

Easily manage complex requirements
There are over 75,000 federal, state, and local jurisdictions.  As their compliance requirements become more complex, we’re the partner that can help you manage them all.

What’s the difference between major lines and limited lines?

The Producer Licensing Model Act (PLMA) defines six major lines of authority for insurance:

  1. Life
  2. Accident and health or sickness
  3. Property
  4. Casualty
  5. Variable Life and variable annuity products
  6. Personal Lines

The PLMA also allows states to offer other lines of authority that allow licensees to offer a more limited range of insurance products. These limited lines are capped at nine per state and must include “core” lines including, car rental, credit, crop, and travel insurance.

What is NAIC vs. NIPR vs. Sircon?

The National Association of Insurance Commissioners (NAIC) is a support organization that represents and is governed by top insurance regulators from all 50 states. The NAIC played a key role in standardizing the insurance licensing process by developing its Uniform Applications and advocating for their adoption by the states. The NAIC also creates model laws and regulations.

The National Insurance Producer Registry (NIPR) is a non-profit created by NAIC to help states standardize the way they share regulatory information for the insurance industry. From the NIPR portal, individuals and entities can apply for new licenses, renew licenses, and upload required documentation, as well as access rules and regulations related to their states’ insurance governing framework.

Sircon is a web portal that allows individuals and agencies to apply for, renew, and manage license portfolios. Many states utilize both Sircon and NIPR for insurance licensing.


Managing compliance obligations, particularly license renewals, amidst ever-changing regulations should occupy an important part of your company’s day-to-day operations. Keeping track of renewal dates, fees, and necessary documents can be complicated and time-consuming.

CT Corporation can help you navigate the insurance industry’s uniquely complex regulatory and licensing challenges.

Learn more

To learn more about how CT Corporation can help you manage your business license needs, contact a CT Service Representative.

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Hans Howk
Manager, Content Management
Hans provides internal support to key members of the Business Licensing Team, assisting with understanding industry nuances, searching and synthesizing statutes and regulations relating to business law.
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