Here's a question that pops up from time to time. In fact, we haven't gotten it since...4:30 this afternoon.
Question: If a licensed insurance producer dies and his surviving spouse does not have a producer's license, can she receive his commissions? If so, for how long?
Answer: Yes, she can, and there is no time limit on how long she can receive the commissions on renewals of policies he sold while licensed. The New York Insurance Department addressed this in an opinion dated December 10, 2004:
Nothing in the Insurance Law precludes the widow of a deceased insurance agent, acting as administrator of his estate, from selling her deceased husband’s insurance business and receiving a percentage of the commissions the agent who purchases the business may earn from subsequent renewals of policies originally transacted by her deceased husband.
The opinion points out that she cannot receive commissions on new policies sold to her husband's old customers, but she can receive the renewal commissions. In a separate 2002 opinion, the department said that an unlicensed executor of a deceased agent's estate may receive future commissions based on business the agent sold during his lifetime.
This should give producers some peace of mind that their survivors will have an income stream from their commissions after they're gone.