Manual producer licensing and compliance management is not only a hassle for your carrier’s compliance management team, it’s also cost heavy. Switching to a real-time, integrated, and automated compliance management solution can take the headache out of producer licensing and appointment compliance and tip the scale from cost-heavy to cost-savings.
In this article we will evaluate:
- The pain points of manual compliance management
- How these pain points ultimately cost carriers time and money
- How switching to a real-time, integrated, and automated compliance management solution (aka AgentSync) can provide carrier cost-savings
For a long time, the insurance industry chugged along the “business as usual” track without a whole lot of change, especially when it came to technology. Some early adopters explored automated solutions pre-2020, but the pandemic caused a seismic shift in the way insurance agencies and carriers leveraged technological solutions in their business processes.
The pressure to adapt to modern challenges, along with the realization that legacy technology may be doing more harm than good, has launched the insurance industry into a technological reckoning as organizations search for modern solutions to address modern challenges. Carriers attempting to navigate industry changes and search for new ways to both optimize their processes and realize cost-savings may want to update their tech stack to include integrated and automated solutions.
As with any major change, overhauling legacy systems and introducing new technology into traditional business processes can come with a lot of uncertainty. Moving to a new system can mean potentially affecting thousands of data points (millions for large-scale carriers) for hundreds of thousands of producers.
We get it, making such a big change is daunting, time consuming, and costly. It makes sense why some carriers choose to put it off for so long, especially when their current systems get the job done. But how much are you paying for costly compliance violations and inefficient manual workflows in the meantime? Pairing automated compliance management tools with human expertise can reduce pain points for employees and save insurance carriers money.
Manual producer licensing and compliance management is no small task
Producer licensing can be a sharp thorn in the side of any carrier still managing the process by hand. Managing appointments, license validation, signatures, onboarding, renewals, and more is already a challenge and only gets more complicated for insurance carriers managing hundreds or thousands of current and prospective distribution partners.
Keeping up with producer and agency data, along with ever-changing state regulatory requirements by hand can make managing distribution partner eligibility feel impossible to scale. Just think of the multiple system logins, unnecessary down time, redundant data entry, and of course: So. Much. Paperwork.
These pain points can lead carriers to avoid compliance management entirely. That is until they are slapped in the face with compliance audits. Even the carriers that do manage to stay on top of manual producer licensing face costly delays and missed deadlines as a result of manual errors.
Manual producer licensing and compliance can cost an insurance carrier
Not only is manual producer licensing and compliance a hassle for the team tasked with handling it, it can also be a big cost center for a carrier as a whole. For starters, just think about the extra labor costs associated with manual producer licensing. No matter which team the task of producer licensing falls on, repeat data entry, paperwork, and keeping up with ever-changing regulatory requirements is not the best use of anyone’s time. And we all know that time = money!
Then there’s the cost of human error. Not only are manual, repetitive tasks a poor use of employee talent and expertise, they are also rife with human error and mistakes. A typo or missed deadline may not seem like a huge deal in the grand scheme of things, but in some cases human error can be a serious time and money suck for your carrier.
How automating compliance management can create cost savings
An automated compliance management solution can help reduce many of the costs associated with manual producer licensing processes by eliminating compliance-related complexity in your workflows. There are four major buckets these cost-savings can fall into: reducing regulatory risk, confidently taking advantage of Just-in-Time appointments, adding efficiency into your producer onboarding workflows, and reducing time spent on manual, low-value activities.
Reduce regulatory risks
While the onus of producer licensing falls on various shoulders throughout the sales channel, carriers tend to bear a majority of the responsibility for ensuring the compliance of their downstream agents and producers. An automated compliance management solution minimizes human touch in your workflows and gives carriers full visibility on the status of each producer’s license. This helps ensure accurate compliance and minimize the risk of costly regulatory violations.
Integrating compliance checks directly into automated workflows – Imagine having effortless compliance verification before, during, and after a producer sells. You’ll never worry about paying out a commission to a producer who falls out of compliance, or missing a Just-in-Time appointment you meant to process, but missed, because a sale falls through the cracks. Built-in compliance checks like these give carriers peace of mind that you’re doing everything you can to avoid the financial and legal costs of compliance missteps.
Automating ongoing compliance checks with an electronic “paper trail” – Your compliance process may be automated, but that doesn’t mean it’s a black hole your team can’t look into. Automating compliance should include automatically creating records you can audit. You’ll minimize human touches while also ensuring accuracy and the ability to verify compliance every step of the way.
Leverage Just-in-Time appointments
If you’re a carrier working across multiple states, you could be wasting thousands of dollars in appointment fees for agents who will never actually write business in those states. AgentSync’s compliance management solution provides real-time state regulatory updates that give you the ability to leverage Just-in-Time (JIT) appointments in a few key ways.
Only pay for appointment fees when an agent writes business – If your organization is in the habit of onboarding a bunch of producers across multiple states and then immediately submitting appointments to every state, you could be spending money to appoint thousands of agents who might never actually sell in that state. With an automated compliance solution, you can onboard producers faster than ever, but wait to pay for appointments until the producer actually writes business in a particular state.
Never miss the timeline for a JIT appointment – With manual processes, it’s much easier to overlook the timeline for a JIT appointment. An automated compliance management solution will help you stay on top of deadlines with real-time data integrations and timely alerts.
Add efficiency into producer onboarding workflows
If you’re interested in providing a world-class producer experience, automating producer licensing and compliance management at your carrier can help. You can stand out from the pack, become a carrier of choice for your top distribution partners, and increase revenue production by decreasing onboarding times and getting producers ready to sell faster than ever.
Onboard producers with speed and ease – Onboarding producers can take days, even weeks when done by hand. An automation revamp can help you streamline the producer onboarding process by cutting out redundant data entry and ensuring compliance every step of the way.
Become a preferred distribution partner – With best-in-class compliance controls you’ll gain the competitive advantage you need to build a strong reputation and continue to grow your carrier.
Reduce manual, low-value activities
Stop paying your people for time-consuming tasks like manual data entry. We’re not talking about replacing your people with an automated solution. We’re talking about using technology to enable your team so they can stop entering and re-entering the same data and start focusing their efforts on more high-value work and you can reduce the costs associated with manual work including:
Wasted human effort that is also prone to error – The more human hands you have in your workflows the more prone to costly human error, oversights, and mistakes your organization is. Taking your talent out of repetitive tasks like data entry with the help of automation not only reduces your risk of human error but also allows staff to get back to more revenue-generating tasks like supporting sales and client retention.
Security risk from unstructured data – Emails, spreadsheets, paper files. These types of unstructured data are common in manual processes and have a couple major drawbacks. For starters, unstructured data is less efficient and less accessible, often requiring large amounts of tedious digging and cross-referencing to find the data you’re looking for. Another major drawback of unstructured data is its security risk. Inconsistencies between data formats makes it easier for hackers to access your data and cause costly security breaches.
Compliance management is complex, but it doesn’t have to be costly
Adding automation into your compliance management process can enable your carrier to reach new levels of efficiency, productivity, growth and even profitability. By taking employees out of manual, repetitive processes with an automated compliance management solution, you can eliminate key pain points in the producer onboarding and licensing process and reduce the chances of costly oversights and compliance violations.
When it comes to introducing automated solutions to your carrier, compliance management is just the beginning. If you’re ready to tip the scale of your organization’s manual processes from cost-heavy to cost-saving by baking automation into every workflow, see how AgentSync can help!