How Insurers Can Save Money While Maintaining Compliance with State Departments of Insurance
Compliance has always been paramount for insurers. Licensing departments are not revenue generating: they spend money but they don’t get back anything in return. However, if you consider that without the licensing department ensuring that producers are appropriately licensed and appointed, and have completed product training (if indicated)—and in many cases, managing the contracting process— then the licensing department, is the most important first contact to ensure the producer is compliant in aspects all before transacting.
All along we have been talking about how to save money. This may be one way in which spending a little now could save you a great deal if the future. It is best practice—and a good habit—to initially perform necessary due diligence by conducting a multi-component search, such as a federal and county criminal search, credit check, and RIRS actions. On an ongoing basis, to follow up, conduct a federal criminal search to comply with 18 USC Sections 1033 and 1034, at minimum. These are federal laws, and the repercussions—financial and reputational—could be significant if your actions are seen as contrary to the law.