General Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
An agent's life insurance license is classified as inactive. Which statement about an inactive license is correct?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
An inactive license is one that is not currently associated with an active appointment by an insurer, or otherwise not in an active status. While a license is inactive, the licensee may not transact insurance on behalf of an insurer. Inactive status is a status condition, not a disciplinary sanction, and the license may generally be returned to active status when the agent becomes properly appointed.
Why the other options are wrong
- B) Inactive licensees lose the authority to transact; returning to active status requires reinstating the proper appointment.
- C) An inactive license belongs to a person who was properly licensed but whose license is not currently active.
- D) Inactive status results from appointment or status conditions, not from fraud or discipline.
Memory hook
Inactive = parked, not revoked. No appointment means no transactions until the license wakes up.