Current through Register Vol. 48, No. 3, March 22, 2024
I.
Purpose
The purpose of this regulation is to establish rules and
standards which shall apply to continuing insurance education for individuals
qualified or licensed to act as insurance producers in this State.
II. Scope
A. The rules contained in this regulation
shall apply to all individuals qualified or licensed to act as insurance
producers in this State, except:
1. Limited
line insurance producers;
2.
Limited line credit insurance producers; and
3. Nonresident producers who have
successfully satisfied continuing insurance education requirements of their
resident state, regardless of the requirements of that other state.
B. Multi-line producers who do not
wish to complete the required eight hours in each line of authority held must
submit a request in writing to the Department to cancel the line(s) of
authority in which they do not wish to complete the eight required hours.
However, the producer must complete a total of twenty-four hours of continuing
education with at least three hours in courses approved as ethics.
C. The Director of Insurance at his
discretion may mandate certain continuing education courses to be taken by
producers to meet continuing education compliance.
III. Definitions
When used with these regulations, the following definitions
apply:
(1) "Approved Course" is a
course offered in a classroom environment that is approved by the South
Carolina Department of Insurance for continuing insurance education credit.
Approved courses may include information on specific insurance products
approved for sale in the state, relevant state or national laws, taxation
related to insurance, insurance practices, ethics, claim procedures and
policyholder relations. Approved courses shall not include courses or portions
of courses developed for prelicensing education, for personal development,
motivation, sales, or personal enrichment. Approved courses must be led or
monitored by an approved instructor.
(2) "Approved Instructor" means an individual
who has been approved by the Department of Insurance in accordance with Section
VI of this Regulation and who teaches or otherwise instructs an approved
continuing education course. The individual must have competency in the subject
matter of the course.
(3) "Proctor"
means a disinterested third party.
(4) "Approved Sponsor" is a responsible
organization which demonstrates it is capable of offering, conducting, and
maintaining quality controls of courses. Approved sponsors may include licensed
insurance companies, producer associations, insurance trade associations,
private organizations, and institutions of higher learning. A sponsor must be
approved by the Department.
(5)
"Classroom" is a location conducive to learning, and may include a traditional
classroom, an auditorium, or other meeting-place, which provides an environment
suitable for the transfer of information.
(6) "Classroom Hour" is at least fifty
minutes of participation in an approved course in a classroom, teleconference
or distance learning. Not more than ten minutes of any sixty-minute period may
be used for breaks, roll taking, or administrative instructions.
(7) "Competency Examination" is a closed book
examination taken and passed by the producer without assistance and personally
monitored by a proctor who is not related to the producer, is not his immediate
supervisor, or his employee. A score of 70 or above is required for the
examinee to pass the examination.
(8) "Compliance Deadline" means every two
years by 5 P.M. on the last day of the licensee's month of birth. Individuals
born in an even numbered year must comply every even numbered year by the last
day of the individual's month of birth. Individuals born in an odd numbered
year must comply every odd numbered year by the last day of the individual's
month of birth.
(9) "Compliance
With Continuing Education for Resident Producers" means completing twenty-four
hours of continuing education by the compliance deadline, with a minimum of
eight hours in each line of authority, with at least three hours of ethics and
paying a recordkeeping fee to the Continuing Education Administrator by the
compliance deadline in a biennial compliance year.
(10) "Compliance With Continuing Education
for Nonresident Producers" means meeting the continuing education requirements
in their home state.
(11)
"Continuing Education Administrator" means the Continuing Education
Administrator responsible for administering the continuing insurance education
requirements. The Director may designate a Continuing Education Administrator
within the Department or, in the alternative, contract with an outside service
provider to function as continuing education administrator and to provide
record-keeping services.
(12)
"Course" means an organized, outlined body of information intended to convey
knowledge or information to the producer.
(13) "Credit Hour" is a value assigned to an
approved course by the Department. Hours of credit are calculated in full
hours.
(14) "Department" means the
South Carolina Department of Insurance.
(15) "Director" means the Director of the
Department of Insurance or his designee.
(16) "Product-Specific" or "Specific
Insurance Products" means information about a particular policy, procedure, or
coverage. This includes, but is not limited to, special rating information,
special underwriting practices, and specialized or unique claim procedures of a
company or group of companies.
(17)
"Recordkeeping Fee" means the fee paid to the Continuing Education
Administrator to cover the costs of compiling and maintaining records
reflecting the continuing insurance education status of all licensed or
qualified producers.
(18)
"Self-study Hour" is a study period of fifty minutes from an approved course
followed by a competency examination. Self-study hours may include textbook
study, video study, intranet, internet, CDROM and other electronic means of
information communication.
IV. Sponsor Approval
A. Sponsors must be approved by the
Department of Insurance before they may submit courses for approval to the
Department. The application to become a sponsor must be submitted to the
Department at least thirty (30) days prior to the Continuing Education Advisory
Committee meeting. If the applicant's type of business is a private entity,
other than an insurance company, producer's trade association, institution of
producer's trade association or institution of higher learning, the applicant
must submit a letter explaining the applicant's type of business and how long
the business has been offering insurance education courses.
B. Before an approved sponsor may offer any
course, the sponsor must submit the course to the Department for approval and
be assigned a course approval number by the Department.
C. Sponsors may not use another sponsor's
course approval number without the prior written authorization of the sponsor.
A copy of the authorization must be submitted to the Department before the
course may be offered.
D. Approved
sponsors of approved courses are responsible for collecting accurate attendance
records and maintaining records containing the names of producers who completed
all sessions of the approved course, or who successfully completed the
competency examination for courses approved for self-study. Sponsors shall
maintain these records for a three-year period following the date of approved
course completion. These records must be made available to the Department upon
request.
E. Approved sponsors are
responsible for the actions of their instructors.
F. Approved sponsors may only offer courses
which have been approved by the Department.
G. Approved sponsors must notify the
Department in writing within thirty (30) days of any change in address and of
any change in the authorized representative of the sponsor.
H. Approved sponsors must allow
representatives of the Department and the continuing education administrator,
in an official capacity, to audit classroom course instruction, correspondence
course review sessions, course records, records of examination and attendance
rosters. These representatives may attend any course offered for the purpose of
the audit without paying a fee.
I.
A sponsor shall report to the Director or his designee any administrative
action taken against the sponsor in another jurisdiction or by another
governmental agency in this State within thirty (30) days of the final
disposition of the matter. This report shall include a copy of the order,
consent to order or other relevant legal documents.
V. Course Approval
A. Approved Sponsors of courses presented for
approval shall submit to the Department at least thirty (30) days in advance of
the Continuing Education Advisory Board meeting an application for approval,
which shall include the following:
(1) a
detailed outline of the course;
(2)
a timetable, with instruction minutes assigned to each topic;
(3) a sample competency examination if the
course is self-study with text reference for each exam question;
(4) course material;
(5) self study courses must include a
certification report of the number of words per document, grade level and
degree of difficulty of the course;
(6) online courses must include a screen
count and number of words per screen; and
(7) a nonrefundable filing fee established by
the Department.
No course may be offered until written notification of its
approval has been issued by the Department. Incomplete submissions will be
disapproved and the application will be returned to the sponsor. The Director
has the discretion to develop different standards for approval of courses
offered by accredited institutions of higher learning and to waive independent
approval of courses offered by nationally recognized industry
organizations.
B. Courses will be approved for a period of
not more than three (3) years from the approval date. Sponsors may apply to
renew course approval.
C. Courses
that are submitted for renewal must include all of the information requested in
Section V (A) of this regulation and must include the page numbers and sections
where updates to course material have been made.
D. Approved sponsors may file an appeal if a
course submission is disapproved or if fewer hours are approved than were
requested by the sponsor. The appeal must specify the exact disagreement and
contain documentation to support the appeal. Appeals must be in writing and
must be submitted to the Department within thirty (30) days of receipt of the
notice of course disapproval or notice of fewer hours approved. Appeals will be
submitted to three representatives of the Continuing Education Advisory Board
for review and recommendation to the Department.
VI. Instructor Approval
A. Instructors must be approved by the
Department of Insurance before teaching any course. The application packet must
be submitted by an approved sponsor thirty (30) days prior to the instructor
teaching any course and must include the following:
(1) a properly completed instructor approval
application;
(2) documentation of
one of the following must be submitted with the application for approval:
(a) a college degree in insurance from an
accredited institution of higher learning;
(b) a professional designation of CPCU or CIC
for property and casualty approval and ChFC, CFP, FLMI, LUTCF or CLU for life,
accident and health approval;
(c)
seven or more years of practical experience in the subject matter;
(d) or a college degree and three or more
years of practical experience in the subject matter;
(e) five or more years of practical
experience in the subject matter and has one or more of the following
professional insurance designations or programs in the subject matter for which
approval is sought: INS or AAI; or
(f) Insurance Department regulators with a
minimum of one year of insurance experience; and
(3)a nonrefundable filing fee to be
established by the Department of Insurance.
Incomplete submissions will be returned to the sponsor.
B. Instructors will be approved for
a period of not more than three (3) years from the approval date. Sponsors may
apply to renew instructor approval.
C. Instructors must ensure that attendees do
not use class time for any purpose other than learning the material being
presented. Instructors should deny credit to anyone who is inattentive or who
does not attend the entire classroom session.
D. Instructors must distribute SCID Form 3617
prior to each continuing education classroom session.
E. Proctors are responsible for checking an
examinee's photograph identification before administering an examination.
Proctors are responsible for returning all examination material to the sponsor
within two days following the completion of the examination.
F. Instructors/Proctors of correspondence
course review sessions must not disclose the examination questions or answers
to the examination questions on the competency examination during the review
session.
G. An instructor shall
report to the Director or his designee any administrative action taken against
the instructor in another jurisdiction or by another governmental agency in
this State within thirty (30) days of the final disposition of the matter. This
report shall include a copy of the order, consent to order, or other relevant
legal documents.
H. Within thirty
(30) days, an instructor shall report to the Director any criminal prosecution
of the instructor taken in any jurisdiction. The report shall include a copy of
the initial complaint filed, the order resulting from the hearing, and any
other relevant legal documents.
VII. Certification
A. Approved Sponsors of approved courses must
submit class rosters to the Continuing Education Administrator according to the
following timetable:
1. Approved classroom
course or seminar - within thirty (30) days of completion of the course or
seminar; and
2. Approved self-study
course - within thirty (30) days of the examination completion date. Rosters
must be properly completed, typewritten or computer-generated and contain the
names and identification numbers of producers who completed all sessions of the
approved course, or who successfully completed the competency examination for
courses approved for self-study. Incomplete or inaccurate rosters will be
returned to the sponsor. Subsequent submissions of any roster that has been
returned must include a letter from the sponsor explaining corrections or any
changes made.
B.
Approved Sponsors of approved courses are required to provide a certification
of course completion to each individual who successfully completes an approved
course or an approved self-study course within thirty (30) business days after
the course is completed or the competency examination results are received.
Verification of the accuracy of the certification provided by the approved
sponsor remains the responsibility of the producer.
C. A producer who successfully completes an
approved course may not repeat the course and receive certification within two
years of its original completion date.
D. Instructors of approved classroom courses
shall be given a certification equal to the number of hours for which the
course is approved. Instructors/Proctors may not be given a certification for
conducting review sessions for approved correspondence courses.
E. Producers who accumulate credits in excess
of the continuing insurance education requirements may apply these additional
credits to the next biennial continuing insurance education period. No more
than eighteen (18) credit hours in the line of authority in which they are
earned may be carried forward to the next biennial continuing insurance
education period. F. No credit will be given for courses taken before they have
been approved by the Department. Credit may not be given for courses that have
not been renewed by the sponsor.
VIII. Forms
The following items must be on forms specified or approved by the
Director: (1) applications for sponsor approval, (2) applications for course
approvals and (3) applications for instructor approval. Class completion
rosters must be submitted electronically to the CE Administrator. However,
individual course completion certificates must be provided to the
producer.
IX. Advertising
A. No course may be advertised as an approved
course until approval has been received from the Department.
B. Announcements, advertisements and
information about courses designated as approved courses by the Department
shall contain the statement "This course is approved by the South Carolina
Department of Insurance for Continuing Insurance Education Credit" followed by
a statement of the number of credit hours and the type of license to which the
credit may apply. If the course offering contains material which is not
approved, the announcement, advertisement or information must clearly state the
amount of course time which is not approved for continuing insurance education
credits.
C. Announcements,
advertisements or information about approved courses shall contain clear and
concise statements about the cost of the course, cancellation procedures, and
refund policies.
X. Fees
Every producer subject to continuing insurance education
requirements pursuant to Section
38-43-106
of the South Carolina Code of Laws is responsible for payment of a reasonable
annual recordkeeping fee to the Continuing Education Administrator for
operation of the continuing insurance education program. The license and
appointment(s) of any producer who does not pay the continuing education
recordkeeping fee by the biennial compliance deadline will lapse on the day
following the biennial compliance deadline. The Department may reactivate the
license and appointment that has lapsed if within six months of the compliance
deadline the continuing education recordkeeping fee has been paid to the
Continuing Education Administrator and a $50 penalty has been paid to the
Department, and proof of completion of a total of twenty-four hours of
continuing education credits has been received. Failure to pay the continuing
education recordkeeping fee and a $50 penalty and providing proof of completion
of twenty-four hours of continuing education credits within six months of the
compliance deadline will result in the license and appointment being canceled.
In order to regain licensure status, the producer must retake and pass the
appropriate producer licensing examination, complete a new application and pay
an application fee to the Department.
XI. Continuing Education Hours
Producers who fail to complete twenty-four hours of approved
continuing education credits by the biennial compliance deadline will have
their license and appointment(s) suspended on the day following the biennial
compliance deadline. Producers may reactivate the license and appointment(s)
that have lapsed, if within six months of the compliance deadline, the
continuing education recordkeeping fee has been paid to the Continuing
Education Administrator and a $50 penalty has been paid to the Department of
Insurance and proof of completion of a total of twenty-four hours of continuing
education credits has been received. The license and appointment(s) of a
producer who does not provide documentation of compliance within six months of
the compliance deadline will be canceled. In order to regain licensing status,
the producer must retake and pass the appropriate producer licensing
examination, complete a new application and pay an application fee to the
Department.
XII.
Non-Compliance
A. The Director shall have the
authority to conduct surveys of producers, approved sponsors, and approved
instructors to verify that the approved courses are administered as filed with
the Department, and to determine compliance with Section
38-43-106
of the South Carolina Code of Laws and the regulations contained
herein.
B. The failure of approved
sponsors and instructors to comply with the provisions of Section
38-43-106
of the South Carolina Code of Laws or with the provisions of these regulations
may result in a fine of not less than $1,000, suspension of approval, or
termination of approval status.
XIII. Hardship Waiver
The request for a hardship waiver must be in writing and must be
received by the Department on or before the individual's biennial compliance
deadline. Hardship waiver requests may only be granted for good cause shown,
with the recommendation of the Continuing Education Administrator and the
approval of the Director. For purposes of this section, "good cause" includes,
but is not limited to, illness or catastrophic events beyond the control of the
producer, which preclude the producer from conducting normal work activities
during the biennial compliance period. The producer must provide sufficient
documentation that the hardship prevented the producer from conducting normal
work activities during the biennial compliance period. A licensed insurance
producer who is unable to comply with continuing education due to active
military service during the biennial compliance period may request a hardship
waiver by submitting a copy of his military orders with the hardship waiver
request. Producers who apply for the hardship waiver must still pay the
Continuing Education recordkeeping fee to the Continuing Education
Administrator by the biennial compliance deadline.
XIV. Administration of Continuing Education
Requirements
The Director is responsible for administering the continuing
insurance education requirements contained in South Carolina Code of Laws
Section
38-43-106
and in this regulation, and is responsible for the approval of courses of
instruction which qualify for these purposes. Effective January 1, 2011, the
compliance deadline to meet continuing insurance education requirements will be
based upon the individual producer's birth month and birth year. To facilitate
the transition from all producers having a May 1 compliance deadline to
individual birth month/birth year compliance deadlines, the Director may
specify the continuing insurance education requirements with which producers
must comply during the transition period ending December 31, 2012. In
administering this program, the Director in his discretion, may designate a
Continuing Education Administrator within the Department, or, in the
alternative, contract with an outside service provider to function as
continuing education administrator and to provide record-keeping
services.
XV. Effective
Date
This regulation shall become effective upon final publication in
the State Register.
