Establishing an effective compliance and ethics program has become a necessity in order to protect your insurance license and keep your agency around long term. Maintaining a high level of integrity among the sales team has become a major issue for most insurance carriers within the last few years. Here are some tips on how to establish a compliance program that will work within your agency:
1. Your agency handbook should be reviewed and updated on a regular basis. Review your agency handbook with new employees shortly after their inception date, and at least semi-annually with existing employees. Don’t assume they remember the details, not to mention things are constantly changing — it’s worth it to have a refresher! Be sure to also keep your handbook as up-to-date as possible and easily accessible to all employees. I suggest storing it on the desktop of all office computers. Don’t have a handbook? Now is the perfect time to create one now (consider using the agency contract as a guide).
2. Create a coverage rejection form AND include it on all new business policies. A coverage rejection form will protect you by clearly illustrating the coverages your clients have rejected. It will also give you an opportunity to review their coverages and look for gaps at their renewal date.
3. Create a “no password sharing” rule. Passwords should not be shared among the individuals in your office. Protect your password just as you would protect your money or it could cost you a lot of money in the future. You would be surprised at the amount of valuable information stored on most computers. Not to mention the risk involved when employees are no longer with your company. Consider changing them when an employee leaves your company.
4. No handwritten notes should be left in the office overnight. All notes should be placed in the agency management system by the end of the business days. Sticky notes are not acceptable forms to store pertinent information. The transfer of personal information is absolutely necessary if agents are to advise their clients. However, given the sensitive nature of the information, federal and state data privacy protection laws apply. Gramm-Leach-Bliley Act , limits disclosure and use of customer information, and imposes a security rule for covered information by “financial institutions” and most insurance agents and brokers.
5. Attention agency owners! This is a reminder: your staff activities are your business. You are held accountable for the behaviors of all of your support staff members (licensed and unlicensed). Protect your clients and protect yourself — be sure your staff is demonstrating the same high level of integrity that you provide to your clients. Your employee’s actions are a direct reflection of you. Many times minor compliance issues can be corrected with some additional training.
6. Create a quarterly training program. Take a least one hour each quarter to review outstanding compliance requests, existing customer services issues, and new underwriting guidelines. The simple rule of “when you know better, you do better” will do the trick!
7. Document everything in your agency management system. NO EXCEPTIONS! If you speak with a customer, make a policy change or even just attempt to contact your client/prospect, it should always be recorded in your agency management system for future reference. Imagine being accused of a wrongdoing by one of your clients. You may be able to prove that you did nothing wrong by providing evidence of your documented conversations. That evidence could also help you avoid an Errors & Omission claim filed against you and save you a lot of big bucks!
Tamara Gatson
President, Gatson Training Associates
Founder, insurancelicensenow.com