No person shall sell or solicit any form of credit insurance in this state unless that person is licensed as an insurance agent or broker pursuant to Article 3 (commencing with Section 1631) or is licensed as a credit insurance agent or endorsee under this article.
Production AgenciesCredit Insurance Agents
Section § 1758.9
If you want to sell or promote credit insurance in California, you must have the proper license. Either be licensed as an insurance agent or broker under certain regulations, or specifically as a credit insurance agent or endorsee.
credit insurance insurance agent license broker license
Section § 1758.91
If you meet certain requirements, you can get a credit insurance agent license from the commissioner. This license lets you sell specific types of insurance mentioned in another section when they are related to a loan or credit extension. You have to work with an insurance company that is allowed to provide these insurances in the state.
The commissioner may issue to an applicant that has complied with the requirements of this article, a credit insurance agent license to offer or sell those types of insurance specified in Section 1758.96 in connection with, and incidental to, a loan or extension of credit, on behalf of any insurer authorized to write those types of insurance in this state.
credit insurance agent license requirements insurance types
Section § 1758.92
This section outlines the requirements for obtaining and renewing a credit insurance agent license. Applicants must submit a written application, a certificate from the insurer confirming their trustworthiness, and pay a fee. Renewal notices are sent 60 days before license expiration, and the responsibility to renew lies with the licensee. Late renewals incur a penalty, but clerical errors by the department may waive this penalty. Additionally, any costs related to enforcement or investigation are the responsibility of the license holder.
(a)CA Insurance Code § 1758.92(a) An applicant for a credit insurance agent license under this article shall submit each of the following to the commissioner:
(1)CA Insurance Code § 1758.92(a)(1) A written application for licensure signed by the applicant or an officer of the applicant, in the form prescribed by the commissioner.
(2)CA Insurance Code § 1758.92(a)(2) A certificate by the insurer that is to be named in the credit insurance agent license, stating that the insurer has satisfied itself that the named applicant is trustworthy and competent to act as its insurance agent limited to this purpose and that the insurer will appoint the applicant to act as its agent in reference to selling or soliciting
the kind or kinds of insurance that are permitted by this article, if the credit insurance agent license applied for is issued by the commissioner. The certification shall be subscribed by an officer or managing agent of the insurer on a form prescribed by the commissioner.
(3)CA Insurance Code § 1758.92(a)(3) An application fee, and, for each license period thereafter, a renewal fee, of four hundred eight dollars ($408).
(b)CA Insurance Code § 1758.92(b) Notwithstanding any other law to the contrary, the provisions set forth in Sections 1667, 1668, 1668.5, 1669, 1670, 1720, 1738, and 1739 apply to any application for or issuance of a license, or any application for or approval of an endorsee, pursuant to this article.
(c)Copy CA Insurance Code § 1758.92(c)
(1)Copy CA Insurance Code § 1758.92(c)(1) Not less than 60 days before a
permanent license will expire, the commissioner may use an electronic delivery method, including email or other similar electronic method of delivery, to deliver, or may mail, to the latest email or mailing address appearing on the commissioner’s records, an application to the licensee to renew the license for the appropriate succeeding license period. It is the licensee’s responsibility to renew whether or not a renewal application is received. The commissioner may accept a late renewal without penalty, provided the licensee’s failure to comply is due to a clerical error or inadvertence on the part of the department.
(2)CA Insurance Code § 1758.92(c)(2) An application for renewal shall be filed on or before the expiration date.
(3)CA Insurance Code § 1758.92(c)(3) The application for renewal of an expired license may be filed after the
expiration date and until that same month and date of the next succeeding year. A licensee who files a renewal application after the license has expired shall be charged, in addition to the renewal fee, a penalty of 50 percent of the renewal fee for the credit insurance agent license and all endorsees.
(d)CA Insurance Code § 1758.92(d) Costs associated with any enforcement action or investigation shall be paid for by the person or organization licensed pursuant to this article.
credit insurance agent license application trustworthiness certificate
Section § 1758.93
This law outlines the requirements for an employee to be an endorsee on a credit insurance agent license. First, the employee must be at least 18 years old. They need to submit an application with a signed affidavit confirming they've read the necessary training materials and understand the credit insurance products they'll be dealing with. There's also an application fee and an annual renewal fee to cover processing costs.
Before an endorsee can sell or offer credit insurance, they must receive training from the licensed organization. This organization must submit training materials to the department each year and inform the department about its endorsees and compliance status. Any changes to training materials must be submitted in advance for approval. If an organization fails to use approved training materials, it risks having its license denied, not renewed, or suspended. Additionally, the organization is responsible for retraining its endorsees periodically.
(a)CA Insurance Code § 1758.93(a) An employee of an organization that has been issued a credit insurance agent license pursuant to this article may be an endorsee on the license if all of the following conditions have been met:
(1)CA Insurance Code § 1758.93(a)(1) The employee is 18 years of age or older.
(2)CA Insurance Code § 1758.93(a)(2) The employee submits an application to the department that includes a signed affidavit, in a form prescribed by the commissioner, stating the applicant has read the credit insurance training material submitted to the commissioner and that the applicant has received from the organization training in, and is knowledgeable about, the credit insurance products to be sold, ethics, and market practices.
(3)CA Insurance Code § 1758.93(a)(3) The employee submits an application fee, and each year thereafter, a renewal fee, in an amount or amounts determined by the department as sufficient to defray the department’s actual costs of processing the application or renewal and implementing this article.
(b)CA Insurance Code § 1758.93(b) Prior to allowing any endorsee to offer or sell credit-related insurance, the licensed organization shall provide training to each endorsee about the credit insurance products to be sold, and shall submit annually to the department the names of endorsees and a statement of compliance with this article. Training materials used by the organization to train endorsees shall be submitted to the department at the time the organization applies for its credit insurance agent license, and each year thereafter when that license is renewed. Any changes to previously submitted training materials shall be submitted to the department with the changes highlighted 30 days prior to their use by the licensee. Training materials and changes to those materials submitted to the department pursuant to this subdivision shall be deemed approved for use by the company unless it is notified by the department to the contrary. Failure by a credit insurance licensee to submit training materials or changes for departmental review or use of unapproved or disapproved training materials shall constitute grounds for denial of an application for a license, nonrenewal of a license, or suspension of a license, as appropriate.
(c)CA Insurance Code § 1758.93(c) The credit insurance agent shall periodically retrain its endorsees.
credit insurance agent endorsees training materials
Section § 1758.94
If a business is licensed as a credit insurance agent, each location must have a manager listed as an endorsee on the organization’s license. This manager is responsible for training and supervising other endorsees.
An employee of the credit insurance agent can act on behalf of the agent if they meet certain requirements. Their actions are considered the actions of the credit insurance agent.
(a)CA Insurance Code § 1758.94(a) The manager at each business location of an organization licensed as a credit insurance agent, shall be listed as an endorsee on the organization’s license and shall be responsible for the training and supervision of each additional endorsee at that location. Each licensee shall identify the endorsee who is the manager at each location for the purposes of this article.
(b)CA Insurance Code § 1758.94(b) An employee of a credit insurance agent who complies with the requirements of Section 1758.93, and is endorsed on the license of the credit insurance agent, may act on behalf of, and under the supervision of, the credit insurance agent in matters relating to transacting insurance under that agent’s license. The conduct of an endorsee of a credit insurance agent acting within the scope of employment or agency shall be deemed the conduct of the credit insurance agent for purposes of this article.
credit insurance agent manager endorsee licensed organization
Section § 1758.95
This law states that if a licensed credit insurance agent or endorsee breaks any rules, the commissioner can either suspend or revoke their license or impose other penalties. If someone sells insurance linked to loans without the necessary licenses, the commissioner can order them to stop. Additionally, specific regulations under Section 1748.5 apply to licensed organizations and their endorsees.
(a)CA Insurance Code § 1758.95(a) If a licensee or endorsee violates any provision of this article or any other provision of this code, the commissioner may do either of the following:
(1)CA Insurance Code § 1758.95(a)(1) After notice and hearing, suspend or revoke the license of the credit insurance agent.
(2)CA Insurance Code § 1758.95(a)(2) After notice and hearing, impose other penalties that the commissioner deems necessary and convenient to carry out the purposes of this code, including suspending the privilege of transacting credit insurance pursuant to this article at specific business locations where violations have occurred, imposing fines on the credit
insurance agent, individual endorsees or endorsee managers, and suspending or revoking the endorsement of a named endorsee or endorsee manager.
(b)CA Insurance Code § 1758.95(b) If any person or persons sell insurance in connection with or incidental to a loan or other extension of credit or hold themselves or an organization out as a credit insurance agent without obtaining the license required by this article, as being an endorsee when that person is not an endorsee, or as being licensed pursuant to Chapter 5 (commencing with Section 1631) without obtaining that license, the commissioner may issue a cease and desist order pursuant to Section 12921.8.
(c)CA Insurance Code § 1758.95(c) Notwithstanding any other provision of law to the contrary, the provisions of Section 1748.5 are applicable to both the organization issued a license pursuant to
this article and any endorsee to that license.
credit insurance agent license suspension license revocation
Section § 1758.96
This California law section specifies that a licensed credit insurance agent can sell certain types of insurance when they are connected to a loan or credit under $60,000, with a repayment period of up to 10 years, concerning real property. If the loan exceeds $60,000, and the agent receives compensation based on the placement of insurance, a different license is required.
The types of insurance that can be sold under these conditions include credit life insurance, credit disability insurance, credit involuntary unemployment insurance, credit property insurance, guaranteed asset protection (GAP) insurance, and any other insurance declared applicable by the commissioner.
A person licensed pursuant to this article may act as a credit insurance agent for an authorized insurer only with respect to the kinds of insurance specified in this section sold in connection with and incidental to a loan or other extension of credit other than a loan in excess of sixty thousand dollars ($60,000) relating to or secured by real property where the repayment period does not exceed 10 years. The sale of credit insurance products as specified in this section in excess of sixty thousand dollars ($60,000) relating to or secured by real property where any compensation, fee, or commission is paid dependent on the placement of credit insurance, requires a license to act as an insurance agent or life agent pursuant to Section 1621 or 1622.
(a)CA Insurance Code § 1758.96(a) Credit life insurance.
(b)CA Insurance Code § 1758.96(b) Credit disability insurance.
(c)CA Insurance Code § 1758.96(c) Credit involuntary unemployment insurance or credit loss-of-income insurance.
(d)CA Insurance Code § 1758.96(d) Credit property insurance.
(e)CA Insurance Code § 1758.96(e) Guaranteed asset protection (GAP) insurance.
(f)CA Insurance Code § 1758.96(f) Any other form of insurance declared by the commissioner to be subject to this section pursuant to subdivision (d) of Section 1758.992.
credit insurance licensed agent loan extension
Section § 1758.97
This section outlines the conditions a credit insurance agent in California must meet before selling insurance. They must give prospective buyers clear written materials summarizing insurance terms, claim filing processes, and any pricing or coverage details as required by law.
The agent needs to inform buyers that purchasing insurance is not necessary for obtaining a loan, and that the insurance might duplicate existing personal coverage. Also, the agent cannot evaluate the buyer’s existing insurance unless specially licensed.
Buyers can cancel the insurance anytime and will receive a full refund if canceled within 30 days. Coverage evidence must be provided, insurance costs must be separately listed in any financial agreements, and the insurance must be under a policy issued by a licensed organization.
These requirements can be fulfilled if similar information is already provided under other laws, and compliance statements do not make insurance forms nonstandard.
A credit insurance agent shall not sell or offer to sell insurance pursuant to this article unless all of the following conditions are satisfied:
(a)CA Insurance Code § 1758.97(a) The credit insurance agent provides brochures or other written materials to the prospective purchaser that do all of the following:
(1)CA Insurance Code § 1758.97(a)(1) Summarize the material terms and conditions of coverage offered, including the identity of the insurer.
(2)CA Insurance Code § 1758.97(a)(2) Describe the process for filing a claim, including a toll-free telephone number to report a claim.
(3)CA Insurance Code § 1758.97(a)(3) Disclose any additional information on the price, benefits,
exclusions, conditions, or other limitations of those policies that the commissioner may by rule prescribe.
(b)CA Insurance Code § 1758.97(b) The credit insurance agent makes all of the following disclosures, either with or as part of each individual policy or group certificate, or with a notice of proposed insurance, or, if the insurance is sold at the same time and place as the related credit transaction, in a statement acknowledged by the purchaser in writing on a separate form, electronically, digitally, or by audio recording:
(1)CA Insurance Code § 1758.97(b)(1) That the purchase of the kinds of insurance prescribed in this article is not required in order to secure the loan or an extension of credit.
(2)CA Insurance Code § 1758.97(b)(2) That the insurance coverage offered by the credit insurance agent may provide a duplication of coverage already provided by a purchaser’s other personal insurance policies
or by another source of coverage.
(3)CA Insurance Code § 1758.97(b)(3) That the endorsee is not qualified or authorized to evaluate the adequacy of the purchaser’s existing coverages, unless the individual is licensed pursuant to Article 3 (commencing with Section 1631).
(4)CA Insurance Code § 1758.97(b)(4) That the customer may cancel the insurance at any time. If the customer cancels within 30 days from the delivery of the insurance policy, certificate, or notice of proposed insurance, the premium will be refunded in full. If the customer cancels at any time thereafter, any unearned premium will be refunded in accordance with applicable law.
(c)CA Insurance Code § 1758.97(c) Evidence of coverage is provided to every person who elects to purchase that coverage.
(d)CA Insurance Code § 1758.97(d) Costs for the insurance are separately itemized in any loan, credit, or retail
agreement.
(e)CA Insurance Code § 1758.97(e) The insurance is provided under an individual policy issued to the purchaser or under a group or master policy issued to the organization licensed as a credit insurance agent by an insurer authorized to transact the applicable kinds or types of insurance in this state. Any of the conditions and disclosures specified in this section shall be deemed satisfied if the consumer is otherwise provided with the information required in this section by any other disclosures required by existing federal or state law or regulations.
No statement, disclosure, or notice made for the purpose of compliance with this section shall be construed to cause the policy form, certificate of insurance, or notice of proposed insurance, by themselves, to be considered nonstandard forms, as described in Article 6.9 (commencing with Section 2249) of Subchapter 2 of Chapter 5 of Title 10 of the California Code of
Regulations.
credit insurance agent insurance terms and conditions claim filing process
Section § 1758.98
A credit insurance agent can't do a few specific things under their license. They can't sell insurance unless it's part of a loan or credit deal. They also can't pretend to be a licensed insurer or other insurance professional. Lastly, they can't pay unlicensed people for placing insurance, though some incentive payments to endorsers are allowed.
Under the authority of the credit insurance agent license, a credit insurance agent shall not do any of the following:
(a)CA Insurance Code § 1758.98(a) Offer to sell insurance except in conjunction with, and incidental to, a loan or extension of credit.
(b)CA Insurance Code § 1758.98(b) Advertise, represent, or otherwise portray itself or its employees, agents, or endorsees as licensed insurers, life agents, property broker-agents, or casualty broker-agents.
(c)CA Insurance Code § 1758.98(c) Pay any unlicensed person any compensation, fee, or commission dependent on the placement of insurance under the agent’s license. Nothing in this subdivision shall prohibit
production payments or incentive payments to an endorsee.
credit insurance agent loan extension of credit
Section § 1758.99
If an organization is licensed as a credit insurance agent, it must clearly show its license number and the department's toll-free consumer hotline on all brochures, information sheets, and any proof of insurance provided.
An organization licensed as a credit insurance agent shall prominently display its license number and the department’s toll free consumer hot line telephone number on brochures and information sheets required by this article and on any evidence of insurance.
credit insurance agent license number display consumer hotline
Section § 1758.991
This law requires insurance companies that sell insurance through organizations licensed as credit insurance agents to file copies of policy documents with the commissioner. These copies can be individual policies for purchasers or certificates under group policies. The commissioner makes these policies available to the public.
Any insurer that provides insurance to be sold by an organization licensed as a credit insurance agent shall file a copy of any individual policy issued to a purchaser, or any policy or certificate issued under a group or master policy to an organization licensed as a credit agent, with the commissioner, who shall make that policy available to the public.
insurer requirements credit insurance agent policy filing
Section § 1758.992
This section explains key terms related to credit insurance in California. 'Enrollment' refers to helping debtors understand and apply for credit insurance policies. A 'creditor' includes those lending money or selling goods and services on credit. A 'credit insurance agent license' allows agents to sell these policies.
'Credit insurance' covers various types, such as life, disability, and unemployment insurance related to credit obligations. It protects debtors by extinguishing some or all of their credit liabilities in certain situations, like job loss or disability.
'Credit life insurance' and 'credit disability insurance' are specific types where benefits pay off a loan if the debtor dies or becomes disabled. 'Credit property insurance' covers personal property used as loan collateral but excludes vehicle damage insurance.
'Guaranteed Asset Protection' (GAP) insurance helps cover what a borrower owes on a car loan if it's stolen or totaled, possibly offering additional money for replacement. Exclusions to GAP insurance include certain dealer and lender agreements.
As used in this article, the following definitions have the following meanings:
(a)CA Insurance Code § 1758.992(a) “Enrollment” means the process of soliciting or accepting enrollments or applications from a debtor under a credit insurance policy, which includes informing the debtor of the availability of coverage, calculating the insurance charge, preparing and delivering the certificate of insurance or notice of proposed insurance, answering questions regarding the coverage, or otherwise assisting the debtor in making an informed decision whether or not to elect to purchase credit insurance.
(b)CA Insurance Code § 1758.992(b) “Creditor” means a lender of money or a vendor or lessor of goods, services, property, rights, or privileges, for
which payment is arranged through a credit transaction, or any successor to the right, title, or interest of that lender, vendor, or lessor, and any affiliate, associate, subsidiary, subcontractor, director, officer, or employee of any of them or any other person in any way associated with any of them.
(c)CA Insurance Code § 1758.992(c) “Credit insurance agent license” means an agent license issued to an individual or organization for the enrollment and sale of credit insurance.
(d)Copy CA Insurance Code § 1758.992(d)
(1)Copy CA Insurance Code § 1758.992(d)(1) “Credit insurance” includes credit life insurance, credit disability insurance, credit involuntary unemployment insurance, credit loss-of-income insurance, credit property insurance, or guaranteed asset protection (GAP) insurance.
(2)CA Insurance Code § 1758.992(d)(2) Credit insurance also includes any other form of insurance offered in connection with an extension of credit
that is limited to partially or wholly extinguishing that credit obligation that the commissioner determines should be designated a form of credit insurance.
(3)CA Insurance Code § 1758.992(d)(3) The commissioner may adopt, pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, reasonable rules and regulations necessary to carry out this subdivision.
(e)Copy CA Insurance Code § 1758.992(e)
(1)Copy CA Insurance Code § 1758.992(e)(1) “Credit life insurance” means insurance on the life of a debtor pursuant to or in connection with a specific loan or other credit transaction, exclusive of any insurance procured at no expense to the debtor. Insurance shall be deemed procured at no expense to the debtor unless the cost of the credit transaction to the debtor varies depending on whether or not the insurance is procured.
(2)CA Insurance Code § 1758.992(e)(2) “Credit disability
insurance” means insurance on a debtor to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is disabled, as defined in the policy, exclusive of any insurance procured at no expense to the debtor. Insurance shall be deemed to have been procured at no expense to the debtor unless the cost of the credit transaction to the debtor varies depending on whether or not the insurance is procured.
(f)CA Insurance Code § 1758.992(f) “Credit involuntary unemployment insurance” or “credit loss-of-income insurance” means insurance issued to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is involuntarily unemployed, as defined in the policy.
(g)CA Insurance Code § 1758.992(g) “Credit property insurance” means insurance that provides coverage (1) on personal property pledged or offered as collateral for securing a personal or consumer loan,
or (2) on personal property purchased under an installment sales agreement or through a consumer credit transaction, but does not include any insurance that provides theft, collision, liability, property damage, or comprehensive insurance coverage in any automobile or any other self-propelled vehicle that is designed primarily for operation in the air or on the highways, waterways, or sea, and its operating equipment, or that is necessitated by reason of the liability imposed by law for damages arising out of the ownership, operation, maintenance, or use of those vehicles. However, that excluded insurance does include single interest coverage on any of those vehicles that insures the interest of the creditor in the same manner as collateral secures a loan.
(h)Copy CA Insurance Code § 1758.992(h)
(1)Copy CA Insurance Code § 1758.992(h)(1) “Guaranteed asset protection” (GAP) insurance means insurance in which a person agrees to indemnify a vehicle purchaser or lessee for some or all of the amount
owed on the vehicle at the time of an unrecovered theft or total loss, after credit for money received from the purchaser’s or lessee’s physical damage insurer, pursuant to the terms of a loan, lease agreement, or conditional sales contract used to purchase or lease the vehicle. GAP insurance, whether sold by a credit insurance agent or another type of licensee authorized to sell GAP insurance, may also include a promise to pay up to five thousand dollars ($5,000) to an insured, in addition to the sum needed to indemnify the insured for the amount owed, to purchase or lease another vehicle.
(2)CA Insurance Code § 1758.992(h)(2) GAP insurance does not include, and no insurance license of any type under this code is required to offer, any of the following:
(A)CA Insurance Code § 1758.992(h)(2)(A) A debt cancellation agreement contained in a conditional sales contract for the sale of a vehicle by a licensed motor vehicle dealer, or a debt cancellation
agreement contained in a lease agreement for the lease of a vehicle by a licensed motor vehicle dealer or leasing company, to waive some or all of either of the following:
(i)CA Insurance Code § 1758.992(h)(2)(A)(i) The difference between the actual cash value of the purchaser’s or lessee’s vehicle at the time of an unrecovered theft or total loss and the amount owed on the vehicle pursuant to the terms of a lease agreement or conditional sales contract used to purchase or lease the vehicle.
(ii)CA Insurance Code § 1758.992(h)(2)(A)(ii) The amount owed on the vehicle at the time of an unrecovered theft or total loss, after credit for money received from the purchaser’s or lessee’s physical damage insurer or from a third-party liability insurer. Such a promise may also include a promise to waive some or all of the amount of the purchaser’s or lessee’s deductible.
(B)CA Insurance Code § 1758.992(h)(2)(B) A promise by a lender as part
of a debt obligation to purchase or lease a vehicle in which the lender agrees to waive some or all of either of the following:
(i)CA Insurance Code § 1758.992(h)(2)(B)(i) The difference between the actual cash value of the purchaser’s or lessee’s vehicle at the time of an unrecovered theft or total loss and the amount owed on the vehicle pursuant to the terms of the debt obligation used to purchase or lease the vehicle.
(ii)CA Insurance Code § 1758.992(h)(2)(B)(ii) The amount owed on the vehicle at the time of an unrecovered theft or total loss, after credit for money received from the purchaser’s or lessee’s physical damage insurer or from a third-party liability insurer. Such a promise may also include a promise to waive some or all of the amount of the purchaser’s or lessee’s deductible.
(C)CA Insurance Code § 1758.992(h)(2)(C) Coverage under subparagraphs (A) and (B) may not result in a credit balance in favor of the vehicle
purchaser or lessee or include a promise to pay money to a vehicle purchaser or lessee in addition to waiving some or all of the amount owed, including some or all of the amount of the purchaser’s or lessee’s deductible. For purposes of this paragraph, a promise to pay money does not include, and a dealer, creditor, or lender shall be allowed to offer, a discount or credit to a purchaser or lessee as an incentive for purchasing, leasing, or financing a replacement vehicle. However, the dealer, creditor, or lender shall require the purchaser or lessee to use the discount or credit on a purchase or lease from the dealer or lessor that sold or leased the original vehicle to the purchaser or lessee, or with the creditor or lender that financed the purchase or lease of the original vehicle.
credit insurance enrollment process creditor definition
Section § 1758.993
This law section clarifies that the rules for selling credit insurance are not intended to interfere with any other laws that also govern how credit insurance is sold. For instance, it points out that the California Financing Law still applies.
Nothing in this article regulating the sale of credit insurance shall be construed to impair or impede the application of any other law regulating the sale of credit insurance, including, but not limited to, the California Financing Law (Division 9 (commencing with Section 22000) of the Financial Code).
credit insurance sale regulation California Financing Law
