Prevention is the new solution

Just-In-Time appointments (JIT) are a huge cost-saving opportunity and risk reduction technique for insurance carriers who use them, but industry adoption remains low. How can carriers better take advantage of this efficient pre-appointment mechanism?

At AgentSync, we’re excited to be a part of the democratization of data, or what you might see as using the wider available data of the insurance industry to transform and improve everyday processes for insurance businesses across the board. In fact, we’re so excited to be connecting compliance resources across the industry that we launched a Compliance Library, an open source for jurisdictional regulations.

While we have a variety of ways that we are using data to innovate, one trend we’ve seen that brings tech advances right alongside changes in state regulation is using daily NIPR integrations to make taking advantage of Just-In-Time appointments easier. If that sounds like a bunch of gibberish to you, let me break it down.

What are Just-In-Time appointments?

Just-In-Time appointments legally give insurance carriers the ability to delay appointing a producer (and paying the associated fees) until the producer actually begins writing business for that carrier in the states that allow JIT appointments.

In 2000, NAIC opened model legislation to the states for Just-In-Time appointments. Previously, if an agent wanted to sell, quote, or explain information about a policy in a given state, they had to be licensed in that state and appointed with the carrier. An insurance broker would raise their hand to ask to be appointed, the carriers would have to file appointments and pay the associated fees in each state individually. And all too often, some percentage of the appointed agents would never write a single contract’s worth of business.

States that allow for JIT appointments instead allow carriers to wait to appoint agents until an agent is actively writing business or has executed on their carrier contract. Carriers can onboard agents, background check them, and then wait to pay state appointment fees until they have a financial incentive to do so. Timelines vary by state, but most states at this point have JIT appointment guidelines. 

Making the case for JIT adoption

From what our team has seen from our partners in the industry, this has the potential to be very valuable, but a lot of carriers are still handling things the same way they always have. They onboard a bunch of insurance agents across many states, and submit appointments to all of the states, thinking “well we’re spending the time to verify licensure, so we might as well submit appointments, too.” Unfortunately, this means they are taking risks and paying to appoint maybe thousands of agents who might not ever write business in all of the appointed states.

Take, for example, Massachusetts, a state that sets appointment fees at $75 per producer. While Massachusetts has other complicated pieces of its appointment laws, it is one of the states that allows for JIT appointments. Imagine onboarding hundreds of agents, or even thousands of agents, and paying $75 per person for appointments. 

For companies working across multiple states, these fees are multiplied. While Massachusetts charges $75 per appointment, you may also have to pay $60 in Florida, $54 in Delaware, $20 per line of authority in New Mexico, and on and on.

If you think about it, using the industry standard that 80 percent of your business is written by 20 percent of your agents, you could be wasting thousands or even millions of dollars in appointment fees in states for agents who will never write a single piece of business in that state. 

For more state-specific fee information, check out the Compliance Library or, for a copy you can export for a point-in-time reference to your own computer, get the 50 State Summary.

checking a timepiece before signing a contract

Using APIs to make JIT regulation work

An application programming interface (API) is techspeak for a doorway between different software systems. AgentSync Manage is powered by our first-in-the-industry real time synchronization with NIPR, bringing complex data structures into a user-friendly and accessible interface. 

We put in the effort to standardize and make a doorway into these data sets, now others are also able to do that and get the information they need without having to go and hire a team of engineers to build and maintain it. Our hard work is yielding fruit beyond just our team to increase usability for others in the industry.

Using the integration with NIPR, we can help people who have limited technical knowledge use identifiers like Social Security numbers or national producer numbers (NPNs) for insurance agents to plug into our API to get up-to-date information. They don’t have to do guesswork to interpret the state specific regulations or know how to code – our open API has made it easy to do things like auto-populating producer data on insurance applications, verifying licenses in real-time, submitting appointments, etc. This is actually a fairly low bar of automation that hasn’t existed due to the usability and access to the data.

This makes it much easier to onboard brokers and then hold off on appointing them until they actively write business. With manual processes, it’s much more likely that operations teams could miss the timeline for a JIT appointment, or that an agent’s state license may have expired – derailing the effort entirely. Instead, we’ve leveraged real-time access to the data and automation to take a process that used to be days or weeks and made it minutes long. Some of our customers now offer their agents a minutes-to-onboard experience thanks to AgentSync’s portals and integrations.

Now, carriers using the tech built on our API can take better advantage of JIT appointments by holding off on paying expensive state fees until they know they will see a return on their investment. 

We have yet to see many carrier or MGA partners fully leverage this now-20-year-old change in regulation, although it’s something that, especially with the help of modern tools and integrations, could keep thousands or even millions of dollars in the bank for these organizations.

The downstream implications of this technology are driving a whole wave of innovation. The largest source of fines across the insurance industry stem from commissions being paid to improperly credentialed agents, typically from lapsed licenses or missing appointments. 

Using our API, we can spell out what licenses and appointments an agent has in what states, and, with our partnership with commissions payment system Varicent, we can now stop problematic commissions from getting paid out and/or prevent agents from transacting without the proper credentials before it happens – and completely automated by software. 

This one integration alone can help insurance carriers, MGAs, and agencies avoid compliance risk while also uncapping their growth funnels. To find out what else AgentSync can do for you, visit our Solutions page.

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