State RegulationsMA specificDifficulty 2/5
A Massachusetts employer enrolls its own employees in a benefit plan the company administers and pays for, receiving no extra compensation for doing so. What is the licensing posture under Massachusetts law?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
M.G.L. c. 175, § 162J lists the activities exempt from producer licensing, and an employer that administers employee benefit plans for its own workforce without extra compensation fits that exemption. The exemption reflects that administering one's own benefit plan is not the business of selling insurance to the public. If the employer began selling or soliciting insurance for compensation outside that role, the exemption would no longer apply.
Why the other options are wrong
- B) A business entity producer license is required when an entity is in the business of insurance transactions; uncompensated administration of the employer's own plan is exempt under M.G.L. c. 175, § 162J.
- C) Human-resources staff enrolling employees in the employer's own plan are not transacting insurance for compensation, so no individual licenses are needed.
- D) Insurance adviser licensing under M.G.L. c. 175, §§ 177A–B is a distinct regulated activity for compensated advice, not a registration step for exempt employers.
Memory hook
Runs its own plan, takes no extra pay — the employer carve-out of section 162J applies.