Montana Life & Health Insurance Exam — Study Guide

This chapter covers the Montana-specific portion of the Life and the Accident & Health (Disability) producer examinations: who regulates insurance in Montana, how you get and keep a license, what you may and may not say when you sell, what Montana requires inside the policy and around a replacement, and what happens when an insurer fails.

Montana's insurance law lives in two places, and knowing which one a question comes from is half the battle:

• Title 33, Montana Code Annotated (MCA) — the Insurance Code itself. The chapters that matter most to you are Chapter 1 (the Commissioner's powers, penalties, and the Insurance Fraud Prevention Act), Chapter 10, Part 2 (the guaranty association), Chapter 15 (basic contract language), Chapter 17 (producers, adjusters, consultants, administrators — licensing, appointment, fiduciary duties, continuing education), Chapter 18 (Unfair Trade Practices, including unfair claim settlement practices), Chapter 19 (the Insurance Information and Privacy Protection Act), Chapter 20 (life insurance and annuities, including the Suitability in Annuity Transactions Act), and Chapter 22 (disability/health insurance, including Medicare supplement).
• Title 6, Chapter 6, Administrative Rules of Montana (ARM) — the Commissioner's own rules. Subchapter 2 is life insurance solicitation and disclosure; Subchapter 3 is replacement of life insurance and annuities; Subchapter 5 is Medicare supplement; and other subchapters cover credit insurance, coordination of benefits, HMOs, and unfair discrimination.

One statute lives outside Title 33 entirely and still shows up on the Montana exam: MCA 49-2-309, in the Montana Human Rights Act, which governs sex- and marital-status discrimination in insurance. Montana is the state most often cited for this rule, so learn it.

A word about numbers. The rules below are stable and are stated affirmatively — Montana genuinely has a guaranty association, a replacement regulation, an unfair trade practices act, an unfair claim settlement practices statute, a best-interest annuity standard, a producer continuing-education mandate, and mandatory right-to-return provisions. The numbers inside those rules are not stable. Hours, fees, filing windows, right-to-return days, penalty ceilings, and guaranty caps get amended by the legislature or through rulemaking. Most figures below were read against a primary source on the date shown in the citation that follows them — the Montana Code Annotated (mca.legmt.gov), the Administrative Rules of Montana (rules.mt.gov), the Montana Commissioner of Securities and Insurance (csimt.gov), or Pearson VUE's current Montana candidate handbook. A figure still followed by [VERIFY] is one that could not be confirmed from a primary source: treat it as unverified and confirm it with CSI before you rely on it. And a citation is not a warranty with no expiry date — the legislature meets and rules get amended, so re-check any figure you are about to act on.

1. The Montana Commissioner of Securities and Insurance

Montana's insurance regulator is the Office of the Montana State Auditor, Commissioner of Securities and Insurance — universally abbreviated CSI, and headquartered in Helena. Its authority comes from Article VI of the Montana Constitution and from Titles 30 and 33 of the MCA.

Here is the Montana quirk that trips up out-of-state candidates: the insurance commissioner is the elected State Auditor. Montana's State Auditor does not audit public accounts the way the title suggests in other states; the officeholder serves ex officio as Commissioner of Securities and Insurance. So "the State Auditor," "the Commissioner of Securities and Insurance," and "the commissioner" in Title 33 all name the same office and the same person. The office is filled by statewide election, not gubernatorial appointment — another common exam distractor.

CSI is organized into three divisions: Central Management, the Insurance Division (company licensing, financial and market conduct examination, rate and form review, producer licensing, consumer services), and the Securities Division. Because the same office regulates securities, a Montana producer selling variable life or variable annuities is dealing with a single regulator wearing two hats — those products are securities as well as insurance and require both the appropriate insurance line of authority and registration through a broker-dealer.

The commissioner's powers

General authority (MCA 33-1-301 through 33-1-306). The commissioner enforces the Insurance Code, adopts reasonable rules necessary to carry it out, issues orders, and conducts hearings. The commissioner may not, however, make rules that extend or restrict what the statutes themselves say — the rulemaking power is implementing, not legislative.

Examination of records (MCA 33-1-311, 33-1-401 through 33-1-413; MCA 33-17-1101). The commissioner examines the affairs, transactions, accounts, records, and assets of every authorized insurer, and may examine any person transacting or claiming to transact insurance business in Montana. Examiners may take testimony under oath and compel the production of books and papers. Producers are squarely inside this power: under MCA 33-17-1101 a resident producer must maintain a place of business in Montana accessible to the public, must display the license (or a copy at each additional location) in that public area, must identify themselves and give their license number to a customer on request, and must keep complete records of transactions under the license for at least 3 years after completion of each transaction (Mont. Code Ann. §33-17-1101; checked 2026-09-05). Those records are open to the commissioner. There is no producer privilege against a records examination.

Cease and desist orders (MCA 33-1-313 through 33-1-316; MCA 33-1-701 through 33-1-711; MCA 33-18-1004 and 33-18-1005). When the commissioner believes a person is engaged in a practice that violates the Insurance Code — and in particular an unfair method of competition or unfair or deceptive act under Chapter 18 — the commissioner may serve a statement of charges, hold a hearing, and issue an order to cease and desist. Chapter 18's enforcement part (Part 10) is the specific engine for unfair-trade-practice orders. Orders are subject to hearing and to judicial review; a person aggrieved by an order may appeal under MCA 33-1-711.

Penalties (MCA 33-1-317). In addition to suspension or revocation, the commissioner may levy civil fines. The statute sets different ceilings for different respondents: a general maximum per violation, and a lower per-violation maximum for insurance producers and adjusters. The general ceiling is $25,000 per violation and the producer/adjuster ceiling $5,000 per violation (Mont. Code Ann. §33-1-317; checked 2026-09-05). These fines are in addition to any other penalty imposed by Montana law, and a fine is an order that may be appealed.

Insurance Fraud Prevention Act (MCA 33-1-1201 through 33-1-1211). Montana defines a "fraudulent insurance act" and makes it unlawful. CSI operates an insurance fraud function, may investigate suspected fraud, and may refer matters for criminal prosecution. Correction: the penalty section is MCA 33-1-1211, not 33-1-1205. Under 33-1-1211 the commissioner may impose the fines set by 33-1-317 ($25,000 per violation generally, $5,000 for producers and adjusters) and may charge the respondent the costs of the proceeding — and, in addition to any other penalty, the commissioner shall require restitution to the insurer or any other person for all financial loss caused by the fraud. Restitution is mandatory; the fine is discretionary (Mont. Code Ann. §33-1-1211, §33-1-317; checked 2026-09-05). MCA 33-1-1205 is the reporting duty, not a penalty: an insurer, independent adjuster, administrator, consultant, or independent producer with reason to believe insurance fraud has been or is being committed must notify the commissioner within 60 days, and a producer of an insurer must report it to the insurer within 60 days, after which the insurer has 30 days to forward a report it finds reasonably likely (Mont. Code Ann. §33-1-1205; checked 2026-09-05). Immunity is provided for good-faith reporting of suspected fraud. [VERIFY the criminal classifications and sentences — those are not in Title 33, chapter 1, part 12, and were not confirmed from a primary source.]

Receivership. An impaired or insolvent insurer is placed under court-supervised supervision, rehabilitation, or liquidation with the commissioner acting as rehabilitator or liquidator. An order of liquidation with a finding of insolvency is the event that triggers the guaranty association covered in Section 6.

What the commissioner is not. CSI is a regulator, not the consumer's lawyer. It takes complaints, investigates, and enforces the code, but it does not litigate an individual's claim or award damages. A producer's failure to respond to a CSI inquiry is itself a discipline problem.

2. Producer Licensing in Montana

Who must be licensed

Under MCA 33-17-201, a person may not act as or hold themselves out to be an insurance producer in Montana unless licensed. Montana's definitions in MCA 33-17-102 carry the standard trio — sell, solicit, or negotiate — and soliciting requires a license even if no sale ever closes. Chapter 17 also separately licenses insurance consultants (MCA 33-17-501 through 33-17-513), adjusters, and administrators (TPAs), and certifies navigators for the health insurance exchange (MCA 33-17-241 through 33-17-244). A navigator certification is not a producer license and does not authorize selling.

Resident license requirements

MCA 33-17-211 sets the general qualifications for an individual resident license. The applicant must:

1. Be 18 years of age or older.
2. Be a resident of Montana (or of another state that grants similar privileges to Montana residents). Correction: MCA 33-17-214 does not terminate a resident license on a move out of state. Subsection (5) says only that a license remains in effect unless it is suspended, revoked, or terminated or the license lapses; residency is a qualification under 33-17-211. It is a nonresident's Montana license that terminates automatically — and only when the home state suspends, revokes, or terminates the home license (Mont. Code Ann. §33-17-214(5), §33-17-401(4); checked 2026-09-05). What 33-17-214(6) does impose is a 30-day written reporting duty, and it is broader than an address change: a licensee must inform the commissioner in writing within 30 days of a change of address or business e-mail address, and of the final disposition of any administrative action related to transacting insurance, any action against a securities license, and any criminal action other than a traffic violation (Mont. Code Ann. §33-17-214(6); checked 2026-09-05).
3. Pass the examination for each kind of insurance applied for, within the 12 months immediately preceding the application (Mont. Code Ann. §33-17-211; checked 2026-09-05).
4. Complete a licensing background examination under MCA 33-17-220. Montana requires fingerprinting as part of this — CSI's process includes an Applicant Rights and Consent to Fingerprint form. MCA 33-17-220 governs the commissioner's action on the background result.
5. Be competent, trustworthy, and of good reputation, with experience or training and knowledge of the applicable provisions of the Insurance Code.
6. Pay the applicable fees set under MCA 33-2-708. The schedule is worth knowing for what is missing from it: 33-2-708 sets no application fee and no renewal fee for a resident producer's license — the only resident-producer entry is a $100 lapsed-license reinstatement fee. A nonresident producer pays $100 to apply, $50 to renew biennially, and $100 to reinstate a lapsed license; an adjuster or consultant pays $50 to apply and $100 to renew. Appointment of a producer by an insurer carries no fee (Mont. Code Ann. §33-2-708(1)(b); Pearson VUE, "Montana Insurance Licensing Candidate Handbook", June 2025, "License Fees"; both checked 2026-09-05). NIPR charges its own transaction fee on top, and the fingerprint fee is paid separately to the Montana Criminal Records Division. [VERIFY the NIPR transaction fee and the fingerprint fee — neither is set in Title 33 and neither was confirmed from a primary source.]
7. Not have committed any act that is a ground for refusal, suspension, or revocation under MCA 33-17-1001.

There is a genuine Montana oddity in this section worth memorizing: an applicant for the life or disability (accident and health) lines may not be a funeral director, an employee of a funeral director, or hold an interest in a funeral business, subject to limited exceptions. That anti-conflict rule is Montana-specific and is a favorite exam item.

Business entities are licensed separately and must designate a licensed individual producer responsible for the entity's compliance with the Insurance Code.

Prelicensing education. Montana's licensing statutes condition the license on passing the examination and clearing the background check; the state does not impose a prelicensing classroom-hour mandate in the way several other states do. CSI's own path to a resident license is four steps — pass the Pearson VUE exam, apply through NIPR, submit the Applicant Rights and Consent to Fingerprint form, and send fingerprints and the fee to the Montana Criminal Records Division — and no prelicensing course appears at any step; the Pearson VUE candidate handbook's licensing checklist likewise lists only the exam, fingerprinting, and the NIPR application (Montana CSI, "Steps to obtaining a resident insurance license", csimt.gov; Pearson VUE, "Montana Insurance Licensing Candidate Handbook", June 2025, "Licensing Requirements Checklist"; both checked 2026-09-05). This is still the single most likely requirement for Montana to add, so re-check it before you advise a candidate.

The examination

MCA 33-17-212 requires a written examination testing the applicant's knowledge of each kind of insurance applied for, the duties and responsibilities of a producer, and the insurance laws and rules of Montana — which is why this chapter exists. MCA 33-17-213 governs the conduct of examinations. Montana's exams are delivered by Pearson VUE, and the "Montana Insurance Supplement — Examination Content Outlines" published by the vendor are the authoritative blueprint. Every major line is a two-part exam — a general portion and a Montana-specific portion, each separately timed — and the Montana portion is weighted heavily toward the commissioner's powers, licensing, and Chapter 18:

The passing score is 75 — a scaled score, not a percentage of questions answered correctly, and numeric scores are reported only to candidates who fail. The examination fee is $65, paid to Pearson VUE at the time of reservation and non-refundable (Pearson VUE, "Montana Insurance Licensing Candidate Handbook", June 2025, pub. #122700, "Available Examinations", "Exam Fees", "Score Explanation"; checked 2026-09-05). One naming trap: Montana's license line and its state exam are called Disability, not "Accident & Health" — the content outline uses the A&H heading, but the handbook's exam table lists "General: Accident & Disability" and "State: Disability".

Recent change: the Montana content outlines were replaced effective March 2, 2026. The handbook now carries two sets — the outlines for exams taken before March 2, 2026 (effective February 16, 2024) and those for exams taken on or after it (pub. #122703, dated 12/2025). The scored-question counts and times above are the same in both, but the tested topics were re-cut, so study only the on/after outline (Pearson VUE, "Montana Insurance Content Outlines", #122703, effective March 2, 2026; checked 2026-09-05).

The commissioner may arrange for the testing service to recover the cost of the examination from the applicant. MCA 33-17-213 lets the commissioner "require a reasonable waiting period before reexamination of an applicant who has failed to pass a previous examination", but fixes no period in the statute (Mont. Code Ann. §33-17-213; checked 2026-09-05). In practice Pearson VUE imposes no cap on the number of attempts at a test center and no waiting period beyond 24 hours: a candidate who fails must retake the entire examination — both Part 1 and Part 2, not merely the part failed, and "must wait 24 hours" before booking, which cannot be done at the test center. Online testing is the one exception — two attempts per exam on OnVUE, after which every further attempt must be taken at a Pearson VUE test center (Pearson VUE, "Montana Insurance Licensing Candidate Handbook", June 2025, "Retaking the Exam" and "OnVUE Retake Policy"; checked 2026-09-05).

Exam exemptions (MCA 33-17-212). Montana excuses from examination, among others: a person continuously licensed as a producer since January 1, 1961; an applicant for the same kind of insurance who was licensed within the 12 months immediately preceding the application (unless that license was suspended, revoked, or terminated for cause); nonresident applicants; limited lines travel insurance producers and persons registered under such a license; and certain casualty producers selling prepaid legal insurance who were doing so as of April 26, 2013 and remain in good standing (Mont. Code Ann. §33-17-212; checked 2026-09-05). The 12-month lookback here is the same window as the one in 33-17-211 — learn the number once and it answers both questions.

Lines of authority

MCA 33-17-214 lists the lines a Montana producer may qualify for. Yours are life (coverage on human lives including endowment and annuity benefits, and it may include accidental death or dismemberment and disability income) and accident and health or sickness/disability (sickness, bodily injury, or accidental death, which may include disability income). Variable life and variable annuity products are a separate qualification layered on top of securities registration. Other lines include property, casualty, personal lines, and limited line credit insurance. Viatical and life settlement activity is separately regulated under MCA 33-20-1301 through 33-20-1318, with license requirements at MCA 33-20-1303.

License term, renewal, and continuing education

Under MCA 33-17-214 a Montana license remains in effect unless it is suspended, revoked, terminated, or lapses — the license does not carry an expiration date printed into the statute. What actually drives renewal is the biennial continuing-education cycle: the license lapses if CE is not satisfied and the renewal is not completed by the lapse date. All three points check out: MCA 33-17-214(5) provides that "each license remains in effect unless it is suspended, revoked, or terminated or the license lapses", with no statutory expiration date; CSI renews on a biennial cycle and tells licensees that "your renewal date can be found in the upper right-hand corner of your license"; and renewal is transacted through NIPR (Mont. Code Ann. §33-17-214(5); Montana CSI, "Licensing", csimt.gov; both checked 2026-09-05). On the fee, note again what is absent: 33-2-708 charges a resident producer nothing to renew — only nonresident producers ($50 biennially) and adjusters and consultants ($100 biennially) pay a renewal fee (Mont. Code Ann. §33-2-708(1)(b); checked 2026-09-05).