(Image credit: Dollar Photo Club.)

Managing and maintaining agent sales and training compliance remains a major challenge for many insurance providers and agents alike.  In states that have adopted the National Association of Insurance Commissioners (NAIC) Model Regulation, agents are required to complete two levels of training—one specific to the annuities class of insurance, and the other for the carrier-specific product that agents sell. As changes are made to products, which happens periodically, agents must also ensure they have completed the most current version of training. This is further complicated by the fact that each state has their own interpretation of the NAIC regulation and agents must be trained in each variation depending on which state they sell in.

In addition, there is the issue of licensing. An agent can be licensed and appointed without being trained and vice versa. However, an agent must have a license and training to legally sell annuity insurance.  Although individual states make the rules and perform audits, the burden of tracking compliance falls on the insurance providers.

For those organizations that rely on manual processes for supporting and tracking this information, there are many challenges:

• Following manual procedures to verify training and license requirements often leads to delays in sales, inaccuracies and increased reporting challenges
• The cost to validate training manually is high as is requires more time and people to accomplish
• The difficulty of tracking agent training completions across numerous educational providers
• If agents don’t fulfill their mandated training requirements and fail to have the necessary licenses in place, any business they sell may become null and void

In a study conducted shortly after training and licensing automation became available in the insurance space, a popular insurance carrier discussed the overwhelming volume of calls required in a typical day just to validate that the sales completed were written by agents who were licensed and trained.

This particular company and many others had to have this type of process in place because the only thing worse than having inaccuracies or delays is finding out that business needs to be returned because an agent wasn’t licensed and/or trained. Not only does it negatively impact the credibility of the agent and the insurance provider, but the long-term impact of the failed customer relationship is hard to salvage.

Automation as Differentiator

Automation is the differentiator and the solution. While some companies continue to use spreadsheets and manually track the process, many have moved to centralized, automated tools for the annuities industry to track, verify and report on producer training completions and authorizations.

With an automated solution, insurance professionals can focus more on client service, closing sales and growing their business instead of using time and resources keeping up with paperwork and spreadsheets. Companies that have integrated automated tools into their work flow have a competitive advantage over those who have not because they can allocate their resources more efficiently, process business faster and lower their costs.

Whether a provider tracks all of this information manually or with an automated tool, transparency into the agent’s authorization to sell is the key here. Carriers that are able to effectively track training and compliance information gain an advantage, with improved client satisfaction that can help to propel business relationships.