What must be designated for a business entity to be licensed as a producer?

• A. Appoint a non-licensed person
• B. Designate a licensed producer as responsible for compliance with state insurance laws
• C. Obtain a bond
• D. File a corporate charter

Answer: (B)

For a business entity to be licensed as a producer, there must be a licensed individual designated to be responsible for the entity’s compliance with state insurance laws. This ensures there’s a qualified, accountable person who handles regulatory duties and oversees the entity’s insurance activities.

Why this best fits: the license isn’t just about the entity existing—it’s about who is legally empowered to act on its behalf. The designated person must hold a current producer license, so the entity’s operations are supervised by someone who meets the state’s licensing standards.

Why the other options don’t fit: appointing a non-licensed person isn’t acceptable because the designated individual must be licensed to legally oversee producer activities; a bond can be a separate requirement but it doesn’t satisfy the need for a licensed supervisor; filing a corporate charter is about forming the company, not about meeting the licensure requirement for a producer.