What Is Reciprocity And Why Should You Understand It?
Reciprocity is a term that insurance adjusters should know inside and out. By understanding reciprocity, you can increase your value as an adjuster, making yourself more attractive to potential employers.
Here at AE21, we want to help you understand reciprocity, which states have reciprocity agreements, and which states are the best to have your license in order to take advantage of these agreements.
In terms of insurance adjuster licensing, reciprocity means that if you hold a license in one state, you can apply for a license in another state without taking the state’s exam or a pre-licensing course. However, this does not mean that you can just automatically cross state borders and start adjusting claims. You still need to go through the application process and meet other requirements of the state you want to work in.
Why would you want a license in more than one state? Well, to put it simply, the more licenses you have, the more valuable you are. Insurance carriers and independent adjusting firms need adjusters who can work wherever claims happen. When a large catastrophe happens in a specific state, the company will know which employees hold a license in that state and they can send them there. Holding licenses in multiple states makes you attractive to employers, increases your revenue, and allows you to help whenever and wherever you are needed.
Many states have reciprocity agreements with one another. According to the National Association of Insurance Commissioners, almost every state has some form of reciprocity agreement with other states. However, the specific terms of these agreements can vary, so it’s important to do your research before getting too excited about the prospect of working in a new state.
So, which states are the best to have your license in order to take advantage of reciprocity? This can vary depending on the specific terms of each reciprocity agreement. However, two of the most popular states in terms of generosity of reciprocity agreements are Texas and Florida. In Texas, for example, adjusters from states with reciprocal agreements can receive a Texas license without taking a licensing exam. In Florida, adjusters from states with reciprocal agreements can receive a license from Florida with fewer requirements than other adjusters. Both states are popular choices for adjusters who want to work in multiple states without having to take multiple licensing exams.
In order to take advantage of reciprocity, you will need your home state license first. If your home state does not require licensing, then you should choose a state to obtain your “Designated Home State” License (also referred to as a “DHS” License), this allows you to maintain an adjuster’s license in a state other than your home state (only if your home state does not issue licenses). This state will “stand in” as your home state for “reciprocity” purposes. More on that here. It is well settled throughout the U.S. that Florida and Texas are arguably the best two for choosing your DHS adjuster’s license. With a DHS license from either Florida or Texas, you can easily become licensed in every state in the union that requires such licensure. All it takes is that you complete and submit an application for licensure and pay that state’s licensure fee (a nominal amount in every state).
AE21 Online offers licensure programs for both Texas and Florida. Taking either of our Texas or Florida courses allows you to waive the state exam and is the first step to establishing your DHS and enjoying the full benefits of reciprocity.
Understanding reciprocity is a crucial part of being a successful insurance adjuster. By knowing which states have reciprocity agreements and which states offer the most generous terms, you can increase your value as an adjuster and make yourself more desirable to potential employers.
At AE21, we are committed to helping you navigate the complex world of insurance adjuster licensing with our state-of-the-art online courses. We make it easier for you to achieve your goals and advance your career.
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