Property & Casualty Insurance Exam (National Portion)Producers and AdjustersHard
A property and casualty producer is convicted of a felony involving dishonesty and a breach of trust. According to federal law (18 U.S.C. § 1033), what must this producer obtain before they can continue to engage in the business of insurance?
- AA new state-issued resident license.
- BA 1033 waiver from the federal government.
- CWritten consent from the state's Commissioner of Insurance.
- DA waiver from the National Association of Insurance Commissioners (NAIC).
Show answer & explanationAnswer & explanation
Correct answer: C. Written consent from the state's Commissioner of Insurance.
Federal law 18 U.S.C. § 1033 prohibits individuals convicted of felonies involving dishonesty or breach of trust from engaging in the business of insurance without the written consent of the state's Commissioner of Insurance. This is often referred to as a '1033 waiver' at the state level, but the consent must come from the state's chief insurance regulator, not the federal government or NAIC.
Why the other options are wrong
- A. A new state license alone is insufficient; specific consent is required due to the federal law.
- B. While often called a '1033 waiver,' the consent is granted by the state Commissioner, not a generic 'federal government' entity.
- D. The NAIC provides model laws but does not issue waivers for individuals.
18 U.S.C. § 1033 Consent (Waiver)
Federal law prohibiting individuals convicted of felonies involving dishonesty or breach of trust from working in insurance without the written consent of the state's insurance regulatory official.
- Applies to felonies of dishonesty/breach of trust.
- Requires written consent from state Commissioner.
- Protects public from untrustworthy individuals.
Memory trick: Felony = Federal Law, need state Commissioner's 'okay'.