Delaware Marketing Rules, Ethics & Unfair Practices
The final state topic covers how a Delaware producer must behave in the market: the prohibited unfair trade practices, the duty to handle client money properly, and the advertising and disclosure standards that keep sales honest. Most of these rules come from the state's unfair trade practices law and related department rules.
Unfair Trade Practices
Delaware's unfair trade practices law lists prohibited methods of competition and deceptive acts in the business of insurance. Prohibited conduct includes misrepresentation of policy terms, false or misleading advertising, unfair discrimination between similar risks, defamation of an insurer, coercion, and deceptive claim practices. Violations can lead to fines and license suspension or revocation by the department.
Rebating, Twisting, and Churning
Rebating (offering any part of the premium or commission, or other valuable consideration, as an inducement to buy) is prohibited in Delaware. Twisting is using misrepresentation to induce a policyholder to drop an existing policy for a new one; churning is a similar replacement abuse involving the same insurer's policies. All are barred because they harm consumers and create unfair discrimination among policyholders.
Fiduciary Duty and Handling Client Funds
Premiums a producer collects belong to the insurer or the client, not to the producer. Delaware treats this as a fiduciary responsibility: funds must be remitted properly and not commingled or converted for personal use. Failing to account for premiums, or misappropriating client money, is grounds for discipline and can also be a crime. Accurate records and honest disclosure are the core of market-conduct compliance.
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State-specific details
State exam facts
- State regulator
- Delaware Department of Insurance
- Exam vendor
- Pearson VUE
- Prelicensing education
- None
- Passing score
- 70%
Who regulates life & health insurance licensing in Delaware?
The Delaware Department of Insurance licenses producers and uses Pearson VUE to administer the licensing examinations.
Does Delaware require prelicensing education for the life & health exam?
No. The Delaware Department of Insurance does not require a prescribed prelicensing program, though prep courses are recommended.
How is the Delaware life & health exam structured?
Delaware uses separate Life Producer and Accident & Health Producer exams via Pearson VUE, each combining general and Delaware-specific questions, with a 70% passing score.
Sources: https://insurance.delaware.gov, https://www.pearsonvue.com/us/en/de/insurance.html
In the Delaware Life & Health Insurance Producer Exam guide: A KEY CONCEPT box, a Common Traps list and a Check Yourself set closing each of the 9 national chapters. Practice here stays free.