- NAIC is developing a template to guide people with qualifying felony convictions, including dishonesty or breach-of-trust offenses, on how to request written consent for an insurance producer license.
- State approaches differ on what counts as a conviction, including plea outcomes, deferred adjudication, sealed records and expunged convictions.
- Virginia’s new sealed-records law, effective July 1, 2026, could create conflicts with the NAIC uniform producer licensing application and non-resident licensing reviews.
The National Association of Insurance Commissioners Producer Licensing Task Force gave a brief update on its proposed template for people with prior felony convictions who seek an insurance producer license.
The template addresses applicants convicted of offenses involving dishonesty or breach of trust. It guides how those applicants request written consent to work in insurance, where federal law otherwise bars participation.
The task force asked for public comments on the proposal last year. Its stated goal: deter people with disqualifying felony records from entering the insurance business without proper consent.
The draft defines the business of insurance as writing insurance, adjusting claims or reinsuring risks through an insurer. It also covers officers, directors, agents, licensed employees and unlicensed employees who act for insurers or people authorized to act for them.
Federal law penalizes insurance businesses and industry participants who knowingly let prohibited individuals take part in insurance work, according to the draft template.
The template defines conviction broadly. It covers a guilty finding by a judge or jury, a guilty plea, a nolo contendere or no-contest plea, probation, a suspended sentence or a fine.
The draft also draws a line around deferred adjudication. States should not review a written-consent request from someone who completed deferred adjudication and does not have a qualifying felony conviction. The template says states also might count pleas in abeyance, diversion outcomes, sealed convictions or expunged convictions within their own definition of conviction.
Richard Tozer, the task force vice chair and Virginia representative, said NAIC sent a survey to all state insurance commissioners.
The task force was not ready to release survey results. State approaches differ across the issues under review, which was expected.
Richard Tozer
Once NAIC presents the results, he said, the task force will review the survey step by step, separating areas of common ground from topics requiring further discussion.
According to minutes from the task force’s May 14 meeting, the survey asks states how they define conviction, how they treat plea outcomes and how those outcomes affect licensing. The draft survey questions were attached to the minutes.
- Texas representative Jodie Delgado suggested one change at the May meeting. She wanted the survey to ask which outcomes states exclude, not only which outcomes they count.
- Oregon representative John Haworth suggested collecting citations to state statutes and regulations. Tozer said the survey would let states enter specific citations and add narrative explanations where needed.
- Delgado said Texas would need to submit multiple criminal code citations. Tozer said he would work with NAIC staff to finish the survey with structured response options for some questions and narrative fields for others.
The May minutes also refer to NAIC documents on what license applicants exclude from disclosure.
Applicants exclude certain misdemeanor convictions or pending misdemeanor charges, including traffic citations, DUI, DWI, driving without a license, reckless driving and driving with a suspended or revoked license. Juvenile adjudications also fall outside the required disclosure list.
Virginia’s recent legislation adds another wrinkle. Tozer said at the May meeting that Virginia passed a law, effective July 1, 2026, removing the requirement for producer applicants to disclose sealed records on insurance licensing applications.
Virginia will tell producer applicants they do not need to report sealed criminal convictions when applying in the state. That creates a downstream issue for non-resident applications: another state receiving an application from a Virginia resident producer might not see the applicant’s complete criminal history from the original Virginia licensing process.
NAIC wants a clearer process for written consent under federal insurance law, while states still retain different criminal-law definitions, record-sealing rules and licensing practices.
The change creates a possible conflict with the NAIC uniform producer licensing application, according to the meeting minutes.
