New Mexico's insurance law is the New Mexico Insurance Code, Chapter 59A of the New Mexico Statutes Annotated (NMSA 1978). The regulator's rules are in Title 13 of the New Mexico Administrative Code (NMAC). This guide covers the New Mexico rules on the regulator, producer licensing, appointments, continuing education, premium handling, unfair practices, fraud and the guaranty associations, with citations. The general concepts are in the national Insurance Regulation guide.

About the exam

New Mexico's producer exams are given by PSI, under content outlines effective July 1, 2026. Every exam requires 70% to pass (13.4.2.11(D)(3) NMAC). New Mexico sells single-line exams and combined exams.

• The life and health outlines devote about 10% of the exam to New Mexico regulation.
• Exams must be available in Spanish on request (13.4.2.11(C)(7) NMAC).
• Retakes: a failed exam can be retaken on any later date, but after four failures of the same exam the applicant waits at least six months (13.4.2.11(D)(5) NMAC).
• Exam waivers (13.4.2.11(B) NMAC): holders of the CLU designation (life and health lines) or the CPCU designation (property and casualty lines); a new resident who applies within 90 days of moving to New Mexico, for lines held in the prior state; a person licensed in New Mexico for the same lines within the past five years whose license wasn't suspended, revoked or refused; and temporary license applicants.
• Using notes or other reference material on the exam is a ground for discipline (NMSA 1978, 59A-11-14(A)(11)).

The regulator

• New Mexico's regulator is the Superintendent of Insurance, who heads the Office of Superintendent of Insurance (OSI). The title is Superintendent, not Commissioner. The office was created as of July 1, 2013 by Article 11, Section 20 of the state constitution (NMSA 1978, 59A-2-1).
• The Superintendent is appointed by the insurance nominating committee, not by the governor or by election. The term is four years, and the Superintendent may apply for more terms. Removal is only for incompetence, willful neglect of duty or malfeasance, after notice and hearing (NMSA 1978, 59A-2-2).
• Rules are adopted only after a hearing and can't extend or conflict with the statute (NMSA 1978, 59A-2-9). Orders are effective only when written and signed (NMSA 1978, 59A-2-10).
• The Superintendent may issue a civil investigative subpoena before a notice of contemplated action (NMSA 1978, 59A-2-8).
• Insurer examinations: as often as advisable, but each domestic insurer at least every five years (NMSA 1978, 59A-4-5(A)).
• An insurer needs a certificate of authority (NMSA 1978, 59A-5-10). A domestic insurer is formed under New Mexico law, a foreign insurer under another state's law, and an alien insurer outside the United States (NMSA 1978, 59A-5-4, -5). Willfully issuing a contract without authority is a misdemeanor with a fine of up to $1,000.

Producers, brokers and consultants

• Sell, solicit and negotiate are defined terms. To negotiate is to confer with or advise a buyer about a particular contract's benefits, terms or conditions. To solicit is to try to sell, or to urge a person to apply for a particular kind of insurance from a particular insurer (NMSA 1978, 59A-12-2).
• A license doesn't give authority to represent an insurer. That comes from an appointment (NMSA 1978, 59A-12-2(G)).
• An appointed producer is the insurer's agent in a dispute, whatever the application says. A broker is generally the insured's agent (NMSA 1978, 59A-18-24; 59A-12-3).
• Lines of authority include property, casualty, life, health and personal lines (property and casualty sold to individuals and families for noncommercial purposes) (NMSA 1978, 59A-12-17(A); 59A-12-2(M)). Variable life and variable annuity requires a life license and a securities license (NMSA 1978, 59A-12-17(B)). A surplus lines broker applicant must hold both property and casualty licenses (13.4.2.9(F)(4) NMAC).
• Insurance consultants: giving advice on policies for a fee, or calling oneself an "insurance consultant" or "insurance advisor," requires a consultant license (NMSA 1978, 59A-11A-1). The contract must be written, in duplicate, and state the fee and services. A consultant may not take a commission on insurance within the subject of the paid advice (NMSA 1978, 59A-11A-5, -7). The license runs two years.

Getting and keeping the license

• Requirements: age 18, the required exams, background questions, fingerprints and state and federal criminal background checks (NMSA 1978, 59A-12-12(B)). The rule also asks for five years of gap-free employment history and an in-state residential or business address (not a P.O. box) (13.4.2.9(C) NMAC).
• 18 U.S.C. 1033: a person convicted of a felony involving dishonesty or breach of trust can't be licensed without the Superintendent's written consent (13.4.2.9(C)(5)(a) NMAC).
• Controlled business: a license obtained mainly to insure the licensee's own life, property or liability, or that of associates, must be canceled (13.4.2.28(B)(2)(b) NMAC).
• Term: the license is perpetual as long as fees are paid and CE is done. Individual licenses continue biennially on the last day of the birth month. Business entities use March 1 (NMSA 1978, 59A-11-10).
• Late continuation: an unrenewed license terminates at midnight on the last day of the birth month. A request within 30 days may be accepted at 150% of the fee (NMSA 1978, 59A-11-10(C)). Within 12 months, the license can be reinstated without an exam with a penalty of double the renewal fee (NMSA 1978, 59A-12-17(D)).
• Address change: the statute requires notice within 30 days (NMSA 1978, 59A-12-17(G)), and the OSI rule says 20 days (13.4.2.26(A)(3) NMAC). A late report costs $50. A licensee who moves to another state files the change with the new state's certification within 30 days (NMSA 1978, 59A-11-24(C)).
• Place of business: a resident producer keeps an in-state place of business open to the public, which may be in the home (13.4.2.26(A) NMAC).
• Temporary license: up to 180 days without an exam, for example for the surviving spouse or personal representative of a producer who died or became disabled, a business that lost its designated producer, or the designee of a producer called to active military duty. A licensed producer or insurer must sponsor the temporary licensee (NMSA 1978, 59A-12-19; 13.4.2.25 NMAC).
• Nonresidents: licensed by reciprocity if in good standing in a home state that treats New Mexico residents the same way (NMSA 1978, 59A-11-24(A)). Nonresidents appoint the Superintendent for service of process (NMSA 1978, 59A-12-25(B)).
• A licensee whose out-of-state license is canceled reports it within 30 days (13.4.2.26(E) NMAC).

Continuing education (13.4.7 NMAC)

• 24 credit hours per compliance period, including 3 hours of ethics, earned in the 24 months before the renewal date. One 24-hour requirement covers all lines held.
• At least 3 hours must be in a classroom or another format with a live instructor.
• No carryover of excess hours to the next period.
• A credit hour is 50 minutes. A course counts once per period, credit is dated by when the course was taken, and only pre-approved courses count.
• Flood: producers who sell flood insurance need at least 4 hours on flood. Long-term care: 8 hours before selling and 4 hours each later period (13.4.7.10(C)(2) NMAC).
• Late CE reporting can bring a penalty of up to $50 (NMSA 1978, 59A-12-26(D)). Nonresidents who meet home-state CE are exempt.

Appointments and terminations

• A producer may not act as an insurer's agent unless appointed by it (NMSA 1978, 59A-11-12(A)).
• The insurer files the appointment within 15 days after the agency contract is signed or the first application is submitted. The Superintendent verifies eligibility within 30 days (NMSA 1978, 59A-11-12(B), (C)).
• Insurers file annual continuation notices and fees by March 1. Appointments not continued end on April 30 (13.4.2.29 NMAC).
• Termination: the insurer notifies the Superintendent within 30 days after the effective date, whether or not for cause. The producer gets a copy within 15 days and has 30 days to file comments (NMSA 1978, 59A-11-13).
• Property and casualty agency terminations: the insurer gives an independent producer 180 days' written notice with the specific reason. It may not terminate for an adverse loss ratio when the producer submitted complete, unaltered applications. For one year afterward, the producer may renew in-force policies (NMSA 1978, 59A-11-13). Fraud, license revocation and failure to remit premium are exceptions to the notice rule.

Premiums, commissions and records

• Premium money is held in a fiduciary capacity. Diverting it is larceny by embezzlement (NMSA 1978, 59A-12-22(A)).
• A producer either remits within 15 days of receipt or deposits the funds in a separate fiduciary account (NMSA 1978, 59A-12-22(B)). Commingling is allowed only for a principal who waived segregation in writing in advance.
• Commissions may be shared only with licensed producers or brokers, and only for lines the recipient holds. Payments to a former owner as part of an agency sale, or to a deceased agent's estate, are allowed (NMSA 1978, 59A-12-24).
• If the customer also pays the producer a fee, insurer compensation needs the customer's documented acknowledgment (NMSA 1978, 59A-12-29).
• Producers keep records of each policy for at least three years after it expires (13.4.2.26(C)(4) NMAC).
• Self-reporting: an administrative action in any jurisdiction within 30 days of final disposition, and a criminal prosecution within 30 days of the initial pretrial hearing (13.4.2.26(D) NMAC).

Discipline and penalties

• Grounds include fraud, forgery, misappropriating funds, a felony conviction, cheating on the exam, knowingly accepting business from an unlicensed person, and failing to obey a child support order or pay state income tax (NMSA 1978, 59A-11-14).
• A denied applicant may request a hearing within 30 days (NMSA 1978, 59A-11-8(C)).
• Suspension may last up to one year. During it, the licensee may only collect and remit premiums on earlier business (NMSA 1978, 59A-11-16).
• Fine instead of suspension: $100 to $500, paid within up to 60 days (NMSA 1978, 59A-11-17).
• General penalties: each Code violation is a petty misdemeanor (fine up to $500). Administrative penalties run up to $5,000 per violation, or $10,000 if willful, by written order after a hearing (NMSA 1978, 59A-1-18).
• An order under the trade practices article becomes final if no hearing is requested within 20 days (NMSA 1978, 59A-16-27).

Unfair trade and claims practices (NMSA 1978, 59A-16)

• Misrepresentation, including calling a policy shares of stock and failing to disclose facts needed to keep a statement from misleading (59A-16-4). False advertising (59A-16-5).
• Twisting: misleading statements or comparisons to get someone to lapse, surrender, borrow against or replace a policy (59A-16-6).
• Defamation of an insurer is a misdemeanor (59A-16-10). Boycott, coercion and intimidation are prohibited (59A-16-19).
• Unfair discrimination, including because of race, color, religion, national origin or sex (59A-16-11 to -13).
• Rebating is prohibited unless a filing or the statute allows it (59A-16-17(A)). A person who knowingly accepts a rebate commits a misdemeanor with a fine up to $1,000 (59A-16-18). Two exceptions to know:
  • Property and casualty insurers and producers may give gifts and prizes worth up to $100 per person per calendar year (59A-16-17(F)). This doesn't apply to life or health.
  • Value-added products or services related to the coverage are allowed after notifying the Superintendent (59A-16-17(H)).
• Charging more than the premium is prohibited. A life insurer may collect what it actually spent on a medical exam or reinstatement, and a surplus lines broker may collect taxes and a policy fee (59A-16-24).
• Unfair claims practices (59A-16-20) include failing to affirm or deny coverage within a reasonable time after proof of loss, lowball offers that force a lawsuit, not explaining a denial, failing to settle catastrophic claims within 90 days of the catastrophe claim number, and counting a mere inquiry as a claim.
• Insurers keep a complaint register for three years or since the last exam, whichever is shorter (59A-16-22).

Insurance fraud (NMSA 1978, 59A-16C)

• Insurers and licensed insurance professionals who reasonably believe fraud occurred must report it to the Superintendent and cooperate. Good-faith reporters are immune (59A-16C-6, -7).
• Claim forms and applications carry a fraud warning (59A-16C-8). Insurers with $10 million or more in New Mexico premiums file an anti-fraud plan (59A-16C-10).
• False claims are graded by amount: $250 or less a petty misdemeanor, up to $500 a misdemeanor, up to $2,500 a fourth-degree felony, up to $20,000 a third-degree felony, and more than $20,000 a second-degree felony (59A-16-23).

Privacy

• Customers get a privacy notice at least annually while the relationship lasts (13.1.3.9 NMAC).
• New Mexico is an opt-in state: before disclosing a consumer's nonpublic personal financial information to a nonaffiliated third party (outside the listed exceptions), a licensee needs the consumer's authorization, not just a chance to opt out (13.1.3.14(A) NMAC).
• An authorization states how long it lasts, never more than 24 months, and can be revoked at any time (13.1.3.20 NMAC).

Guaranty associations

• New Mexico Life and Health Insurance Guaranty Association (NMSA 1978, 59A-42-4): $300,000 life death benefits (no more than $100,000 cash value); $250,000 annuity present value; $500,000 health benefit plans; $300,000 each for disability income and long-term care; $100,000 other health. Medicare Parts C and D and Medicaid plans aren't covered. Using the association in sales is prohibited, and a summary document is delivered with the policy (59A-42-17).
• Property and casualty guaranty association: covered claims are limited to $100,000 per claim and per claimant per occurrence. Workers' compensation claims are paid in full. A claim must exceed $25 (NMSA 1978, 59A-43-4). Surplus lines insurers aren't covered.

Common exam traps

• Superintendent, chosen by a nominating committee, not Commissioner and not appointed by the governor.
• CE: 24 hours, 3 ethics, 3 with a live instructor, no carryover.
• Termination notice: 30 days, for any reason. Appointment filing is 15 days.
• Premium funds: remit within 15 days or use a fiduciary account.
• Gifts up to $100 a year are allowed only for property and casualty.
• P&C guaranty limit is $100,000, but workers' compensation claims are paid in full.