Adjuster License Reciprocity – What It Is and What It Is NOT

Insurance adjuster license reciprocity is one of the more mystifying and perplexing topics that confuses new adjusters and insurance professionals.

To understand what adjuster license reciprocity is, it is important to comprehend what it doesn’t mean. It doesn’t mean that if an adjuster gets a license in one state, then he or she can automatically start working claims in another state that offers reciprocity. That adjuster will still have to complete new application processes in order to work in new states. This is the most common misunderstanding of licensing reciprocity.

There is a situation when insurance adjusters can cross state borders and perform their craft quickly without having to jump through too many hurdles. In a state of emergency, a state’s insurance commissioner can choose to relax rules so that out-of-state adjusters can come into the state and do their work. In fact, this concept is not about reciprocity but only occurs in very special circumstances. The confusion surrounding adjuster license reciprocity has very likely been fueled by accounts that have to do with a state of emergency.

In fact, adjuster license reciprocity is the mutual arrangement between states that allows licensed adjusters in one state to quickly apply for a license in another state. Usually, the new state will exempt the adjuster from having to take new licensing courses or exams required for new state’s license. This way, the adjuster’s application will be issued faster.

Texas is notorious for having an adjuster license policy where its licenses are highly reciprocal with other states. Texas’s All-Lines adjuster license is reciprocal in more than half of the states in the country. This means that Texas will reciprocate the issuance of adjuster license to non-residents.

Applicants of a new license in Texas will still have to fulfill all the requirements on their applications and pay a fee. However, there are specific rules that may hinder an adjuster’s pursuit for a new license. In some circumstances, adjusters must have a resident license to obtain a license in a new state. The establishment of residence is a specific requirement that some states have when reciprocating adjuster licenses.

Quite a few states do not offer adjuster license reciprocity and are very strict in their insurance adjuster licensing requirements. In California, Hawaii, Massachusetts, New York, and Arizona, adjusters will not be able to bypass an adjuster course or exam with reciprocity. In order to work in those states as an adjuster, a person will have to take the state-mandated adjuster class and test. Non-residents of Nevada who want to work in Nevada as an adjuster are out of luck: the state only issues adjuster licenses to Nevada residents.

It is important to grasp clearly what insurance adjuster license reciprocity is and is not. It is not a way to bypass licensing requirements of specific states, nor is it a loophole that allows adjusters to obtain licenses from several states irresponsibly.

Some adjusters think that one state license can open doors for them in other states, but this is not the entire picture. (For example, a Florida resident is not exempt from an adjuster exam in his/her home state, simply by using a Texas license.)

Be sure to research each state’s licensing regulations and governances before pursuing a license that may or may not work in your favor.

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