The Life and Health Guru - Answering Life's General Insurance Questions

What Are The Insurance Licenses Needed To Sell Annuities?

For those of you looking to start a career as either an insurance agent or a financial advisor, you are undoubtedly interested in learning what are the insurance licenses need to sell annuities.  While there is not really an annuity license per se, there are a number of different insurance licenses that are required in order to sell annuities.

Annuities, similar to other financial and insurance products, are regulated by the government.  Who can sell annuities is determined by the state and federal licensing departments.  Additionally, the type of annuity contract that you want to sell can determine what licenses you need.

If you are only interested in selling fixed annuities and equity indexed annuity contracts, you are required fewer licenses than a variable annuity.  Variable annuities are considered securities by FINRA, and are therefore regulated as such.

All annuity products are regulated by each individual state department.  The state has been responsible for the regulation of insurance products for well over a hundred years.  Each state determines the regulations of their insurance products, though most follow similar guidelines.   In order to sell non-securities annuity contracts, you must first have your life insurance license, more commonly known as the Life, Accident, and Health Insurance License (or even Life and Health Insurance License).

Variable annuities, on the other hand, require an additional license or two.  In order to sell variable annuities your must also have your Series 6 and/or Series 7 license from FINRA, or Financial Industry Regulatory Authority (formerly the NASD).  As such the Series 6 and Series 7 licenses can sometimes be referred to as a variable annuity license. You may also be required to obtain your Series 63 or 65 as well in order to sell securities in your particular state.

Testing for the exams is administered by FINRA, and an abundance or study materials can be found online to prepare for the tests. Most careers in financial planning and insurance will require these licenses before hiring.  They are often supplemented with a credential such as the CFP, ChFC, or CLU further into your career.

The insurance licenses needed to sell annuity contracts are entirely dependent upon the types of annuities that you intend to sell.  Either way you will need your license to sell insurance in your particular state.  Be sure to properly research your firm’s requirements for licensing before starting the process.  Many of the FINRA licenses require a firm’s sponsorship before testing is available.  Also recognize that FINRA does not administer these tests for free.  You will want to be adequately prepared before taking the test to maximize your chances of passing.

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