A licensed life agent delivers an issued policy and, months later, helps the client process a beneficiary change and answers questions about premium payments. Under California Insurance Code Section 35, these follow-up activities are:
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Section 35 defines transacting insurance to include solicitation, negotiations preliminary to execution, execution of a contract of insurance, and the transaction of matters subsequent to execution of the contract and arising out of it. Policy servicing — processing a beneficiary change, handling premium-payment questions, or making coverage adjustments — falls squarely within the final category, so it is part of transacting insurance and requires a valid license. This is why an agent cannot hand the servicing work to an unlicensed assistant and why license discipline can follow mishandled post-issue transactions.
Why the other options are wrong
- B) The licensing requirement does not end at issuance; Section 35(d) expressly includes matters subsequent to execution, so servicing activities remain part of transacting insurance.
- C) Home office staff may perform clerical functions, but an agent's client-facing servicing of the policy is transacting insurance and is within the agent's licensed authority.
- D) Beneficiary changes are routine policy services under the existing contract; no new application is required, and the activity remains part of transacting insurance.
Memory hook
Section 35 covers the whole lifecycle: solicit, negotiate, execute, and service. Follow-up work still counts as transacting.