If your state doesn’t offer a resident insurance adjuster license, chances are that you will need to get your first license in another state. This is accomplished with a designated home state license.
In this article we will cover:
- What a designated home state (DHS) license is
- Why you may need to designated home state license
- How to get your designated home state license
Texas is one of three states that offers a designated home state insurance adjuster license. We recommend people choose Texas to designate as their home state for their easy online system and friendly service if you ever need to reach the licensing department.
What is a Designated Home State (DHS) Adjuster License
A designated home state (DHS) license is an insurance adjuster license offered specifically to allow people to become a licensed adjuster in states that don’t provide their own licensing.
Example: The state of Illinois does not offer or require any licensing to conduct insurance adjusting practices, so if people need to get their license for one reason or another, they would go to a state that offers a designated home state license, like Texas.
Essentially, this allows the applicant to act as though Texas is their “home state” (thus the name!) in licensing terms.
So does this mean that a person in ANY state can get a designated home state license?
Technically, yes. A person from any state can designate Texas as their home state. But, if you live in a state that requires its own adjuster license, then you should absolutely get that license first. This will allow you to conduct business in your own state without getting spending unnecessary time with licensing.
Remember: Insurance licenses do not cross state lines.
Why Do I Need A Designated Home State (DHS) Adjuster License?
If you live in a state that doesn’t require a license, it may seem like a waste to get an adjuster license. While you may be able to go without for a while, there will come a time when the benefits will outweigh the effort.
There are two main reasons why a person would need a designated home state license: non-resident licensing and career marketability.
Insurance adjusting is a unique business, as there are times when opportunities arise in other areas of the country and you must travel outside of your state to take advantage of these events. Especially for Catastrophe (CAT) adjusters.
This means that you will in most cases need to obtain a license in whatever state the situation is in. As mentioned earlier, insurance licenses only work in one state.
To get a license in a state that is not your home state, you will apply for a non-resident license in that state.
These states do, however, require that you have a license in your home state before you are able to attain their license, and since some states don’t offer an adjuster license, this is where designated home state licenses come in.
If you have a designated home state license then you will be able to apply for a non-resident license using Texas as your home state.
Problem solved! Some states will even waive the licensing exam to licensed applicants when applying for a non-resident license; all you will need to do is submit the application and pay the fee.
While it is true that some states don’t require that you have a license to practice insurance adjusting, you may come to a situation where a potential employer prefers a person carry a license.
Think about this: if you apply for a position at an adjusting firm with no real-world experience, and someone else without any experience applies for the same position, except they have a license, who do you think that position going to?
There are also situations when a company will eventually want you to be able to travel to impacted areas outside of your home state. Having a license will put you one step closer to being able to make that trip.
How to Get a Texas Designated Home State Insurance Adjuster License
Step 1. Designated Home State Adjuster Pre-Exam Education
Preparation for this exam is not something to take lightly, as the average pass rate of insurance exams nationwide is around 55% for first-time test-takers, and even less for any following attempts. We want you to pass your test the first time you take it.
Studying for this exam can take many different forms. The most common way to get prepared is to take an online study course. These courses are generally comprised of video and text with short knowledge quizzes to make sure you have a comprehensive understanding.
A slightly more minimal approach would be to purchase a state-specific study guide. These guides give you all of the facts that you need to pass the exam and maybe a bit less expensive than a course. They are, however, quite long and densely packed books, so be sure you are ready to tackle this task.
You should choose the method that fits best for you. Some people learn best out of a book, while others take in information better through video and short text. Remember, the goal is to pass your exam on the first attempt, so pick your best path forward and study hard.
For Texas DHS insurance adjuster pre-license education courses and exam prep, StateRequirement recommends:
Step 2. Texas Designated Home State Insurance Adjuster License Exam
The next step after completing all your coursework is to take and pass the Texas Designated Home State Insurance Adjuster License exam.
This is a proctored test, which means that you will be in a controlled environment with a person watching over you. For people who haven’t tested in a situation like this should be aware of this fact, and work on taming their nerves prior to sitting for the exam. When you arrive at the exam location you must have a photo ID any other documents that the testing facility has asked you to bring.
The Texas Designated Home State Insurance Adjuster license exam consists of one hundred fifty (150) questions, and you have two and a half hours (2:30) to complete it.
An outline of included subjects for these exams can be found here: Pearson VUE Texas Insurance Examination Content Outlines.
Each attempt of the exam costs $62 and will be paid when you make your reservation. The exam code, which is needed when signing up for an exam, is InsTX-ALAdj16.
A total score of 70% or more is required to pass this test. To explain the scoring of these exams, we will quote the Pearson VUE Texas Insurance Licensing Candidate Handbook:
The passing score of an examination was set by the Texas Department of Insurance (in conjunction with Pearson VUE) after a comprehensive study was completed for each examination. Raw scores are converted into scaled scores that can range from 0 to 100. The scaled score that is reported to you is neither the number of questions you answered correctly nor the percentage of questions you answered correctly. With a passing score of 70, any score below 70 indicates how close the candidate came to passing, rather than the actual number or percentage of questions the candidates answered correctly.
Insurance license tests are intentionally difficult, but not impossible by any means. You should study to the point of comfortability with the information before you attempt the test. Failing the exam isn’t the end of the world, but keep in mind that you will need to pay the fee each time you attempt the test.
You may register to take your exams and find more information on the Pearson VUE Texas Insurance page or by calling Pearson VUE at (888) 754-7667.
Step 3. Fingerprinting and Background Check
The State of Texas requires that all insurance license applications provide fingerprints prior to licensing. Giving your fingerprints will initiate a background check. If you have any prior misdemeanors or felonies, this may affect the outcome of your licensing efforts. If you have specific questions regarding things that may come up on your background check you may call the Texas Department of Insurance at (512) 676-6500 or send them an email.
You will make your fingerprinting reservations through IdentoGO. When prompted to enter the code, use 11G6QF. Before making reservations, please have the IdentoGO – Texas Fingerprinting Service Code Form printed. Appointments can be made on their website or by phone at (888) 467-2080.
The fee for fingerprinting services is $47.
At your fingerprinting appointment, you will not receive a fingerprint card, as the information will be automatically sent to the DPS and FBI. You will, however, receive a receipt. Do not throw this receipt away. You need to make a copy of this receipt, as you will be sending one in a later step.
Step 4. Texas Designated Home State Insurance Adjuster License Application
Once you have completed your exams and fingerprinting, you are now ready to apply for your license.
The fee for an online application is $50 plus a small processing fee.
Apply online with the Texas Designated Home State Insurance Adjuster License Application (TDI).
Be sure to upload your fingerprint receipt from IdentoGO with your application. Any other supporting documentation requested by the Texas Department of Insurance should be sent to Texas Department of Insurance.
Step 5. Application Review
Once you have submitted your application and have completed all the other requirements, your license application will be reviewed by the state. This process generally takes about two to five (2-5) weeks. Depending on the results of your background check, the Department of Insurance may request more information or documentation.
After the review is complete, you will receive an email from the state regarding the status of your license.
You’ve done the work, put in the time and effort, and now hold the key to your own success! We’re proud of you. Take five (5) minutes and celebrate.
Texas Department of Insurance Contact Information
Texas Department of Insurance
P.O. Box 149104
Austin, Texas 78714-9104
Phone: (512) 676-6500
Texas Designated Home State Insurance Adjuster License FAQ
How long does it take to get a designated home state insurance adjuster license in Texas?
In Texas, the process of designated home state insurance adjuster licensing can range from a few weeks to a few months (pre-exam education, pre-license exam, background checks, license application, and application review). Follow the steps above to get your insurance license in Texas.
Do you need a license to become an insurance adjuster?
Yes. Earning an insurance adjuster license allows you to increase your income potential, add to your credibility, and qualify for advanced employment opportunities.
Is being an insurance adjuster difficult?
Being an insurance adjuster can be a highly rewarding role. In fact, insurance claims adjusters enjoy their work and report high levels of job satisfaction, according to Payscale.
How much do insurance adjusters make?
According to the Bureau of Labor Statistics, the most recent median annual salary for claims adjusters, examiners, and investigators was $65,080. This was higher than the median salary for all occupations in May 2021, which was $45,760. The highest earners worked for the government, with a median salary of $81,890. If you want to work as a catastrophe (CAT) adjuster in areas frequently affected by natural disasters (like the Gulf Coast), you will likely have higher earnings potential and employment. For independent insurance adjusters that work on commission rather than salary, the high demand for claims adjusters in these areas can result in a lot of business.
What skills are needed to be an insurance adjuster?
Insurance claims adjusters typically investigate insurance claims and travel to locations to inspect property (such as automobiles, buildings, etc.), assess damage, and make notes on repairs and costs. Insurance adjusters deal with individuals in high-stress situations a lot so you must have a professional attitude at all times. Due to the nature of the job, insurance claims adjusters must have excellent communications skills, write clearly, be comfortable with math and basic computer software, and have a flexible schedule since they travel a lot to areas hit by disasters with irregular work hours. Insurance adjusters must have specific industry knowledge to interpret contracts, determine insurance claim payouts, and make recommendations for how the insurance company proceeds in resolving the claim.
Do you need a degree to be an insurance adjuster?
You don’t need a four-year degree to become licensed as an insurance adjuster. However, you will need to complete your education requirements or pass the Texas insurance adjuster exam to be a licensed insurance adjuster. One of the prerequisites to fulfill your education requirements is to complete a minimum number of hours of college level insurance-related coursework. If you are working on an associate’s or bachelor’s degree, you can take courses that will work toward the Texas insurance adjuster license requirements.