State RegulationsNJ specificDifficulty 2/5
A New Jersey agency hires two employees: one will answer phones and file policy paperwork in the office, and the other will meet prospects and negotiate insurance applications. Who must hold a producer license?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
New Jersey's producer requirement, enforced by the New Jersey Department of Banking and Insurance, follows the activity of selling, soliciting, or negotiating insurance. The field employee who meets prospects and negotiates applications performs exactly that activity and must be licensed. The office employee performs clerical support, which is not a licensed activity. An agency's own licensure does not blanket-cover the individuals who do the market-facing work.
Why the other options are wrong
- A) An agency license does not substitute for individual licenses; the producer definition attaches to the natural persons doing the selling or negotiating.
- B) Filing and phone duties are clerical support, not the selling, soliciting, or negotiating that triggers the licensure requirement.
- C) Not every agency employee is a producer; licensure follows the insurance-selling activity, not mere employment at an agency.
Memory hook
Whoever negotiates the application holds the license; whoever files it does not.