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Understanding NARAB

The National Association of Registered Agents and Brokers Reform Act of 2015 (NARAB II) was signed into law by President Obama on January 12, 2015 and was included in legislation that reauthorized the Terrorism Risk Insurance Act (TRIA).

NARAB was created in order to provide for a more streamlined approach in the regulation of agent licensing on a multi-state basis. It also allows for greater consumer choice through increased competition amongst producers.

The NARAB entity will be private, non-profit and governed by a board of state insurance commissioners and industry representatives. Provided a mandatory background check is passed, any insurance producer (or agency in good standing with their home state) will be able to join NARAB and operate in any state for any line of insurance that is covered under their home state license. All states will retain regulatory authority, and agents who are NARAB members will be forced to comply with the rules and regulations in each individual state. The NARAB entity will also be self-funded and prohibited from accepting federal government funding.

We have supported this legislation for years and expect it to significantly improve the state-based system of insurance regulation for producers. NARAB will eliminate the burdensome, and often redundant, requirements put forth by the current system and allow agents to attain multi-state licenses through a consistent and effective manner.

Membership Benefits:

-NARAB will act as a central clearinghouse for its members

-Once an agent becomes a member, they will choose which states they wish to operate in

-After paying the appropriate fees to NARAB, the agent will be authorized to act as an insurance producer in any jurisdiction they designated

-The foreign corporation registration requirement will be eliminated in those states where members secure a non-resident license


-NARAB memberships will be optional and voluntary

-Producers who do not wish to become members will still be able to obtain licenses on a state-by-state basis

-Members will still pay state licensing fees, but the process will be simpler

-The cost of membership has yet to be determined, but membership fees will likely be the primary source of funding for the organization

-Renewals will be done on a biennial basis

-All NARAB applicants will be required to submit a national criminal background check

Continuing Education:

-NARAB will be prohibited from offering continuing education courses

-The entity will establish a CE requirement that is comparable to requirements in the majority of states

-Members who comply with the requirements in their home state will also have to comply with NARAB requirements

-NARAB will be prohibited from requiring members to satisfy duplicative continuing education requirements that have already been satisfied through the member's home state

Board of Directors:

-The 13 member Board will consist of eight insurance commissioners and five industry representatives. Three must have significant experience in property and casualty insurance, and two much have significant experience in life and health

-Not more than four of the insurance commissioners appointed can belong to the same political party

-Board members will need to be appointed within 90 days of the law's enactment, and members should have their first meeting within 45 days of their appointment




This document is not a legal opinion and should not be relied upon as such. The intent of this document is to provide a general background regarding the topic or topics discussed, not to provide legal advice. Producers and agencies should consult an attorney regarding specific situations and specific questions with respect to the topic or topics covered in this document. Neither the Insurance Agents & Brokers nor any of its employees shall be responsible for any errors or omissions regarding any statements made in this document, nor any errors or omissions regarding any statutes, regulations, court rules, and/or any other government documents cited in this document.


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