The Personal Lines Insurance exam is an assessment covering key concepts of personal lines insurance, including insurance concepts, terminology, policy structure and provisions, and state-specific regulations based on the state where you are applying for a license. Every state requires you to pass the Personal Lines Insurance exam in order to sell personal lines insurance, …
The Personal Lines Insurance exam is an assessment covering key concepts of personal lines insurance, including insurance concepts, terminology, policy structure and provisions, and state-specific regulations based on the state where you are applying for a license. Every state requires you to pass the Personal Lines Insurance exam in order to sell personal lines insurance, but the content within the exam will differ depending on the state you are applying for a license.
In this post, we will cover all topics needed to successfully pass the Personal Lines Insurance exam, including cost, length, difficulty, scoring, and content breakdown. We will also discuss how to take the exam, how to prepare, and next steps post-exam.
Personal lines insurance refers to any kind of insurance that covers individuals against loss that results from death, injury, or loss of property. This allows people to do things such as own a home or drive a car without the risk of financial disaster if things go astray.
The Personal Lines Insurance exam is a state licensing exam needed to become a personal lines Insurance provider. Individuals taking this exam consist of insurance agents and financial service professionals. With a personal lines insurance license, agents are able to provide insurance to home and automobile owners.
The Personal Lines Insurance Exam comprises two sections, a general portion and a state-specific portion. The general questions test your federal insurance product and agent knowledge. The state-specific questions test you on the insurance regulations and laws that you will need to know in order to operate as an insurance agent within your specific state.
The Personal Lines exam is relatively uniform but does vary slightly from state to state. In Colorado for example, the exam consists of 113 questions total, including 104 scored questions and 9 pretest questions, distributed across 5 sections. Pretest questions are used for the collection of statistical data to use in future examinations; they are not identified and do not affect your score. A time limit of 2 hours and 15 minutes is given for the exam.
The Personal Lines Insurance Exam covers a range of crucial topics intended to test your knowledge of the insurance industry. Pearson Vue’s outline for the Personal Lines Insurance Exam breaks the content into five sections. Remember, content varies by state. In this article, the Colorado-specific Personal Lines Insurance Exam is being used as an example.
Topic | Questions | % of Test |
|---|---|---|
Types of property policies | 10 | 9.6% |
Types of casualty policies | 13 | 12.5% |
Property and casualty insurance terms and related concepts | 28 | 26.9% |
Property and casualty provisions and contract law | 24 | 23.1% |
Colorado state laws, rules, and regulations | 29 | 27.9% |
Total | 104 | 100% |
This section covers the general form structure, types of coverages and coverage conditions, exclusions, and selected endorsements for the different types of property policies. Coverage forms including HO-2 through HO-8 are tested for homeowners policies, and DP-1 through DP-3 for dwelling policies. Other forms of insurance such as inland marine, flooding, earthquakes, mobile homes, watercraft, and windstorms are also reviewed.
This section mainly delves into all things personal automobile insurance. You will need to know the different types of auto insurance, personal auto policy coverage parts, and key terms and definitions. Specific topics include liability coverage, medical payments, physical damage, exclusions, and insured, uninsured, and underinsured motorists. Umbrella and excess liability are covered as well.
This section tests your understanding of insurance fundamentals, as it covers the basics of property and casualty insurance, including policy structure and key definitions. You will be tested on key concepts such as insurable interest, risk, hazard, peril, loss, defenses, damages, and negligence elements.
This section covers common policy provisions and laws. Specifically, declarations, and insuring agreements such as unfair discrimination, controlled businesses, defamation, rebates, unfair claims practices, and the Colorado Fraud Statute are included.
This section will test your knowledge on Colorado-specific laws, rules, and regulations. Topics include producer licensing, enforcing insurance laws, unfair trade practices, and regulations specific to property and casualty insurance.
The difficulty of the personal lines insurance licensing exam will vary based on individual preparation, experience, and familiarity with insurance concepts. For some candidates, the exam may pose challenges due to the breadth of topics covered. Additionally, the time constraints of the exam require efficient time management skills to navigate through questions effectively. However, with dedicated study, candidates can improve their exam readiness and confidence.
Each state administers its own insurance licensing procedures, and not all states publicly disclose pass rates for their exams. Among states that do provide this information, the collective pass rate for all insurance exams stands at around 55–65%.
The National Association of Insurance Commissioners (NAIC) gathers data on seven distinct types of exams. Here is the national pass rate for each of the seven types of insurance exams:
As you can see, the Personal Lines Insurance Exam pass rate is similar to the other insurance exam pass rates, indicating a standard difficulty level when it comes to insurance exams.
For complete data for every exam in every state, view our post on insurance licensing exam pass rates by state.
There are multiple versions of each of the licensing examinations, known as forms. Although all forms of an examination are developed based on the content outlines, the difficulty of the forms of an examination may vary slightly because different questions appear on each form. To ensure that no candidate is put at an unfair advantage or disadvantage, a statistical procedure known as equating is used to correct for differences in form difficulty. A second statistical procedure known as scaling is used to derive the numerical score to report for each candidate. Scaling is used to place a raw score on a common reporting scale on which each scaled score represents a given level of knowledge regardless of the difficulty of the form on which the raw score was achieved.
In order to obtain your personal lines insurance license, you will need to receive a passing score of 70% or higher on the exam.
The price for the Personal Lines Insurance Exam varies by state between $33 and $113, with New York offering the most affordable exam and Wyoming hosting the priciest exam. This must be paid when you reserve your exam time slot.
Before registering to take your Personal Lines Insurance Exam, you should enroll in a pre-licensing course. Not all states have a pre-licensing certification requirement. However, it is highly recommended to spend at least 50 hours studying for this exam. In Colorado, 50 hours of pre-licensing education, including the completion of a state-approved course, is required in order to take the exam. You will need to submit your certificate of completion in order to register for the exam. Whether your state requires a pre-licensing course or not, you should start your course of study by familiarizing yourself with the exam’s content outline provided by your state’s insurance department.
Preparing for the Personal Lines Insurance Exam requires a structured approach and dedication to mastering key concepts. There are zero questions on your exam that are based on common sense or critical thinking. All questions are purely factual, and so will relate to how well you understand and remember the content that you have learned.
It’s finally time to take the exam. The registration process varies depending on your state, so it’s crucial to review the specific requirements outlined by your state’s licensing authority. You’ll need to register online or over the phone with your state’s testing provider. For Colorado, this is Pearson VUE. The exam is allowed to be taken online or at a physical Pearson VUE testing location. Reservations can be made no later than 24 hours in advance, and walk-ins are not available.
When arriving for your exam, you must present two forms of current signature identification. The primary identification must be government-issued, bearing a photo and a signature, and the secondary identification must contain a valid signature. If your state requires a pre-licensing course, you will need to bring your certificate of completion.
Many testing facilities provide test-takers with a printed copy of their exam results upon completion of the test. If you pass, you’ll receive a paper with instructions on applying for your state license, but you might need to wait a few days for the test center to confirm your passing grade before applying. If you don’t pass, you’ll get a report showing which areas you need to study more for next time.
Exam results are only valid for 12 months. Upon passing, make sure to apply for your license within 12 months of your exam date to avoid needing to take the exam again.
Maintain your license by being aware of your continuing education requirements. Most insurance licenses must be maintained by completing a certain number of credit hours of continuing education each licensing period.
If you do not pass the exam, you have the option to retake it. However, you have to pay the testing fee again. The number of exam attempts allowed varies by state. Typically, states permit candidates to retake the exam multiple times, but there may be restrictions such as waiting periods between attempts or limits on the total number of retakes within a certain time frame. Typically, the waiting period is fewer than 90 days. Exams taken online can only be done once. Any further exams will need to be taken in a testing center.
Congratulations, you’re one step closer to becoming a personal lines insurance provider! Don’t let yourself get overwhelmed. The exam can be challenging depending on your specific knowledge and strengths, but is not any more difficult than its fellow insurance examinations. Having a solid study plan goes a long way, so make sure to utilize the content outline and pre-licensing education courses, and don’t forget to check for state-specific content, rules, and regulations in the process.
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