The old image of the agent who worked alone and did everything is outdated. Agents who want to be effective and productive need administrative support to reduce the time spent on tasks that don’t lead to sales. It is rare to find successful, experienced agents who do not have one or more administrative support staff members working with them. It is these staff members who can provide key protection to agents against compliance and market conduct errors.
Policies, rules, procedures … being in compliance means dealing with details. It takes organization and follow-through to be in compliance with rules and regulations and company policies and procedures, and administrative staff members are the ones who can relieve agents of much of this burden.
An agent needs to begin by knowing how his or her administrative staff can help with compliance and market conduct and then once that is identified, he or she can train and educate them so that they can carry out these responsibilities.
How administrative staff can help
Checking for errors, omissions, etc. on applications, supplemental forms and required forms.
Many compliance mistakes can be traced back to administrative mistakes on applications and forms that get compounded and magnified as time passes. Not paying attention to administrative procedures can create situations where there is the temptation to fix the problem by “cutting corners.” For example, failing to get a signature on a form when the application is completed can lead to the temptation to have it signed later, which might be improper. Not conducting a complete needs analysis and risk profile can lead to an unsuitable sale.
Some of the things agents can have their administrative staff members do to avoid potential compliance problems are:
o Maintain up-to-date copies of the administrative guidelines for each company the agent works with and have them provide the agent with a synopsis for the product he/she plans to recommend.
o Check the agent’s work to make certain he/she is following procedures, such as including the proper form, that all signatures are present, etc.
o Develop checklists that the agent can use to ensure that he/she covers all of the administrative requirements in the proper order.
Keeping a compliance calendar
Compliance is an ongoing stream of activities, due dates, etc. It is sometimes easy to lose sight of a key date given the pressure of a busy insurance practice. Administrative staff can monitor due dates and alert the agent in advance of the date so the agent can meet his or her obligations without taking the chance of making errors in a last minute scramble to meet a deadline.
An agent’s administrative staff can help by keeping an annual calendar of compliance responsibilities up-to-date and alerting the agent on a regular basis of what is coming due. For example:
o What are the due dates for meeting continuing education requirements; e.g., for state license renewal and registered products? (This may be several dates if the agent holds licenses with several states.)
o When are the agent’s and support staff member’s license renewal dates? (This may be several dates if the agent holds licenses with several states.)
o When is the annual compliance meeting for registered representatives?
o When is it likely the agent will have an annual or quarterly office examination or audit?
o When must illustration software be updated?
Keeping up-to-date on rules and regulations
An experienced insurance professional has every right to rely on his or her tried and try methods and procedures, but not keeping up-to-date can lead to potential compliance blunders. For example, agents who do not keep up-to-date may not realize that features, costs and benefits of familiar products may have changed, that some of their favorite sales materials have become obsolete or that newer products are more suitable than older, familiar ones. It can be difficult to find the time to keep up-to-date, but it is a price agents have to pay to avoid potential compliance problems. Potential accusations of misrepresentation, unsuitable sales and improper disclosure could result from not keeping up-to-date.
Some of the things agents can have their administrative staff members do to avoid these potential problems are:
o Have the administrative staff organize information on product changes and provide them to the agent on a weekly basis to review. Have them hold updates, etc. until they have all of the information so that the agent only needs to review it once.
o Have them periodically check the dates on the sales materials the agent typically uses. Are any particularly old? Have them see if there are more up-to date materials available.
o Have them alert the agent to any significant changes in administrative procedures that could have an impact on consumers or clients.
o Have them flag as important any changes to rules and regulations that impact the agent or his or her clients.
o Since most agent have appointments with a number of companies, have them collect and organize all of the information on a change to a law or regulation from all of the companies the agent does business with and provide it to the agent, rather than give the agent a number of different communications on the same regulation change.