Key Takeaways
- Pennsylvania P&C producers must act in good faith and with reasonable care toward clients
- Producers must disclose material information about policies, including exclusions and limitations
- Premium handling must follow strict procedures including prompt remittance to insurers
- Records must be maintained for examination by the Department
- Pennsylvania CE includes mandatory 3 hours of ethics training per renewal period
Last updated: January 2026
Producer Conduct and Responsibilities
Pennsylvania P&C insurance producers have legal and ethical obligations that govern their professional conduct.
Fiduciary Duties
Pennsylvania producers owe duties to their clients:
Key Duties
| Duty | Description |
|---|---|
| Good Faith | Act honestly in all dealings |
| Disclosure | Reveal material information about policies |
| Competence | Maintain professional knowledge |
| Care | Exercise reasonable care in placing coverage |
| Confidentiality | Protect client information |
Agency Relationships
| Relationship | Primary Duty To |
|---|---|
| Agent of insurer | Insurer (but fair to client) |
| Broker | Client |
| Both | Must act ethically |
Disclosure Requirements
Pennsylvania P&C producers must disclose:
Required Disclosures
- Coverage limits, deductibles, and premiums
- Policy exclusions and limitations
- Material terms and conditions
- Tort election options (auto insurance)
- Surplus lines status (if applicable)
- FAIR Plan status (if applicable)
- UM/UIM coverage options
Tort Election Disclosure
For auto insurance, producers must:
- Explain limited tort vs. full tort options
- Document the client's choice
- Provide written disclosure of rights
- Not make election for client
When Disclosure Required
- At time of sale or recommendation
- When material facts change
- When replacing existing coverage
- When client asks specific questions
- At renewal when applicable
Premium Handling
Producers must handle premiums properly:
Requirements
| Requirement | Rule |
|---|---|
| Collection | Only collect authorized amounts |
| Deposit | Promptly to insurer or trust account |
| Commingling | Prohibited with personal funds |
| Conversion | Using premiums for personal use prohibited |
| Records | Detailed records required |
| Remittance | Per agreement with insurer |
Trust Account Requirements
If holding premiums:
- Must be in separate trust account
- Cannot mix with personal or business funds
- Detailed records required
- Subject to Department examination
Penalties for Mishandling
| Violation | Consequence |
|---|---|
| Commingling | License suspension/revocation |
| Conversion | Criminal prosecution |
| Late remittance | Contract termination |
| Poor records | Examination findings |
Record Keeping
Pennsylvania requires producers to maintain records:
Required Records
| Record Type | Requirement |
|---|---|
| Applications | Maintain for examination |
| Policy documents | Maintain for examination |
| Client correspondence | Maintain for examination |
| Premium records | Maintain for examination |
| Claims records | Maintain for examination |
Access to Records
- Department can examine during investigations
- Must provide upon request
- Failure to maintain is a violation
- Electronic records acceptable
Ethics Requirements
Continuing Education
Pennsylvania requires ethics training:
- 3 hours of ethics each 2-year renewal period
- Part of 24-hour CE requirement
- Must be Department-approved course
Professional Standards
| Standard | Description |
|---|---|
| Fair Treatment | Treat all clients fairly |
| Competence | Maintain professional knowledge |
| Conflicts | Avoid conflicts of interest |
| Confidentiality | Protect client information |
| Reporting | Report illegal or unethical conduct |
Test Your Knowledge
How many hours of ethics CE does Pennsylvania require per 2-year renewal period?
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Test Your Knowledge
What must a Pennsylvania producer do when selling auto insurance regarding tort options?
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D