FCUs may become licensed insurance agents
ALEXANDRIA, Va.-Under the NCUA's recently approved incidental powers rule, a federal credit union may provide members with the opportunity to purchase a third party's vendor insurance, which may require the credit union to become a licensed insurance agent under state or local law, according to a recent legal opinion letter. The recent rulemaking codified several different federal credit union authorities, as well as lifting the limitation of pricing of products permitted. "Acting as a finder, an FCU may perform administrative functions for vendors and its members to facilitate their transactions, as previously authorized under group purchasing," the letter read. "Therefore, an FCU may act as a finder of insurance companies as a services to its members and earn income from engaging in finder activities, without restriction, under our rule." However, the FCU may be subject to other federal, state, and local laws, the letter reminded, and therefore, could be subject to license requirements and income restrictions.