Before a producer may sell, solicit, or negotiate insurance for an insurer, what must they secure from the insurer?

• A. Appointment to the insurer
• B. Appointment
• C. License
• D. Surety bond

Answer: (B)

Securing appointment from the insurer is what allows a producer to represent that insurer and to sell, solicit, or negotiate its policies. The appointment creates the agency relationship: it authorizes the producer to act on the insurer’s behalf and to bind coverage within the scope of that appointment, with commissions paid by the insurer as compensation. Without this appointment, the producer would be acting without authority and the insurer wouldn’t authorize commissions or binding authority for that producer. Licensing is a separate requirement from the state, and a surety bond, while sometimes related to licensing, is not the authorization required to represent a specific insurer.