The first quarterly gathering of 10 major trade groups with interests in annuities will be held this spring, according to Mark Mackey, president and CEO of NAVA Inc., Reston, Va.
The purpose will be to see what the groups can do together to address the public perception of annuities, he said in opening remarks here at NAVA’s annual marketing conference.
NAVA and American Council of Life Insurers have already worked together in recent years on matters related to annuities, he noted. Now, 8 more industry organizations are joining the discussions, and all 10 will meet quarterly, starting with the spring meeting, he said.
The participating trade groups are NAVA, ACLI, the Financial Services Roundtable, the Securities Industry and Financial Markets Association, LIMRA International, the Committee of Annuity Insurers, the Insurance Marketplace Standards Association, the National Association of Independent Life Brokerage Agencies, the National Association of Insurance and Financial Advisors, and the National Association for Fixed Annuities.
Last year, noted Mackey, NAVA had determined that a chief barrier to increasing annuity sales has been lack of coordination among industry trade groups. The new initiative should help address that problem, he indicated.
Another problem NAVA has been addressing, he said, is the perception among advisors and clients that annuities are more difficult to sell and to buy than are other financial products.
In response, NAVA has developed and is now gearing up to implement a set of standards for the sale and processing of annuity applications, he said. Called straight-through processing (STP), the standards will be implemented in various web-based functions, including electronic signature, interactive and electronic forms, workflow, electronic document delivery document management and records.
Sixteen companies have tentatively agreed to participate in a pilot program using these standards this year, Mackey said.
NAVA actually began work on the underpinnings of STP many years ago, pointed out Tim J. Lyons, vice president-business solutions at Nationwide Financial, Columbus, Ohio, and co-chair of NAVA’s technology committee. So far, there are 24 standards, he said. The plan is to implement them incrementally, “not with a big bang,” he explained. Improvements will include things like enabling re-use of data, which will reduce the need for the advisor to keep re-typing the information, Lyons said.
From the consumer’s perspective, STP should simplify the entire process.
For companies, STP will help cut expenses associated with document delivery, Mackey added.
The rules are built-in, auditable and trackable, too, Lyons said.
STP will be good from a regulatory compliance standpoint, Mackey confirmed, predicting “the regulators will love it.”