Free New Mexico Health Insurance Practice Exam Online

Correct answer: B. The Office of Superintendent of Insurance

Correct. NMSA §§ 59A-11-2, 59A-11-3, and 59A-12-12 place producer licensing authority with the Office of Superintendent of Insurance (OSI), which now houses New Mexico's insurance regulatory functions.

• A: New Mexico insurance licensing is not handled at the county level; it is a state licensing function.
• C: The PRC formerly housed OSI's predecessor functions, but current producer applications are filed with OSI directly.
• D: NAIC's NIPR system is used to submit applications electronically, but the licensing authority itself is OSI, not NAIC.

Correct answer: B. A producer generally acts on behalf of an insurer, while a broker generally acts on behalf of the insured in placing coverage

Correct. NMSA § 59A-12-2 defines insurance producer (generally representing the insurer under an appointment) and § 59A-12-3 defines broker (placing business with an insurer on behalf of the insured, not as its representative).

• A: Both producers and brokers may hold authority across multiple lines; the line of authority does not define the two roles.
• C: Both roles require licensure under the New Mexico Insurance Code.
• D: Both producers and brokers are ordinarily compensated by commission; that is not the distinguishing feature.

Correct answer: B. Is compensated directly by the client for advice rather than by commission from an insurer

Correct. NMSA §§ 59A-11A-1 through 59A-11A-8 govern insurance consultants, who advise clients for a fee paid by the client rather than earning commission from the sale of a policy, which is why the Insurance Code licenses and regulates them under a distinct article.

• A: Surplus lines placement is a separate license category, not the defining feature of a consultant.
• C: Consultants are licensed under their own article of the Insurance Code; they are not exempt.
• D: A consultant license can extend to accident and health advice as well as property and casualty, depending on the lines held.

Correct answer: B. A current resident producer license in good standing in their home state, with equivalent lines of authority

Correct. NMSA § 59A-12-25 and § 59A-11-24 require a nonresident applicant to hold a valid resident license with matching lines of authority in their home state as a condition of New Mexico nonresident licensure.

• A: Nonresident licensure in New Mexico is built on reciprocity with the applicant's home-state license, not on having no license elsewhere.
• C: New Mexico does not require nonresident applicants to hold a New Mexico driver's license.
• D: There is no federal insurance producer certification that substitutes for state licensure.

Correct answer: B. Continuing an existing producer's business, such as after the death or disability of a licensed producer

Correct. NMSA § 59A-11-4, § 59A-12-19, and NMAC 13.4.2.12 authorize temporary licenses in transitional circumstances, such as continuing the business of a producer who has died, become disabled, or entered military service, for a limited period.

• A: A temporary license does not replace the examination requirement generally; it addresses a specific transitional need.
• C: A temporary license is time-limited, not indefinite.
• D: A temporary license does not eliminate future continuing education obligations for the person if they go on to hold a full license.