State RegulationsGA specificDifficulty 3/5
A Georgia applicant plans to use a new producer license to write coverage only on property and interests of the applicant's own business. Which statement is correct under Georgia law?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Georgia, as administered by the Office of Commissioner of Insurance and Safety Fire, imposes no numeric percentage cap on controlled business. Instead, the test is purposive: a license will not be granted or continued where its primary purpose is writing insurance on the licensee's own interests. A producer may lawfully write some controlled business, but a license that exists mainly to insure the licensee's own risks will not be issued or renewed.
Why the other options are wrong
- A) Georgia deliberately uses no fixed percentage cap; the abuse test looks to the primary purpose of the license rather than a production ratio.
- B) There is no rule barring controlled business during the first 2 years of licensure; the limit is the primary-purpose test, not the license's age.
- C) Holding an insurable interest does not remove the restriction — an insurable interest may justify the coverage, but a license whose primary purpose is self-insuring will still be denied or not continued.
Memory hook
Georgia counts no percentage — it watches your purpose, not your ratio.