State RegulationsGA specificDifficulty 1/5
Which statement best describes how Georgia treats controlled business — insurance written on the interests of the licensee or of the licensee's immediate associates?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under O.C.G.A. § 33-23-1, Georgia permits controlled business and, unlike some jurisdictions, sets no numeric percentage limit on it. The statutory control is the primary-purpose test: a license will not be granted or continued if its primary purpose is writing controlled business. The practical consequence is that a producer may insure his own and his associates' interests freely, as long as the license is genuinely intended for a broader agency operation.
Why the other options are wrong
- A) Controlled business is not prohibited; Georgia allows it and regulates it through the primary-purpose licensing standard.
- B) There is no probationary or initial-period rule; the primary-purpose test applies throughout the life of the license.
- D) The rule is not tied to employment by a single insurer; it applies to all licensees regardless of insurer affiliations.
Memory hook
Georgia's controlled-business test is a purpose test, not a percentage test.