Oklahoma Announced it No longer Allows Backdating!
The Oklahoma Department of Insurance announced on October 27, 2017 that they will no longer allow appointments to be backdated beginning December 27, 2017. Oklahoma will join Georgia and Pennsylvania, which also do not allow backdating of appointments.
What is appointment backdating? Generally, it is the process by which states allow carriers to appoint an agent “within a reasonable number of days” that starts when an agent first submits a new policy application to the carrier, or when agent submits the application and contract simultaneously. The actual appointment date is triggered on the date a carrier first requests the appointment process, either through the NIPR or an electronic portal, and when the state receives the request and approves the appointment. However, the carrier must ensure the requested appointment date falls within the 15 days rule (in Oklahoma) and any other state appointment days’ rule.
For example, Jim Jones sends a new Application to Carrier A on 10/01/2017. Prior to accepting this new application, the carrier needs to have completed or processed a background check and any other onboarding and licensing verifications requirements before the new application gets accepted and issued. The policy is issued on 10/20/2017, so for Jim to get paid commission on the policy, he should have been appointed by 10/16/17.
Each carrier has their own business-rule requirements when it comes to appointments and should have a process in place to ensure they meet the required appointment rules set by each regulated state. Some carriers require an agent to get appointed when first contracted, or hold off getting them appointed until the agent submits the contract and application simultaneously.
The appointment is the authorization from the carrier that gives the agent the authority to act on its behalf as an agent. Regulators, carriers, and agencies are working together to more specifically define terms such as “the date business is submitted,” “the date business is accepted” and “the date the agent/agency contract is executed,” to alleviate confusion and concern over the starting date of the appointment period.
This detailed, time-consuming task can be made easy by Implementing an automated compliance software that gets notifications of regulatory changes from each stated in real-time and update your records accordingly. VUE Software’s once-and-done workflow automates the entire producer management process including regulatory compliance.