Why Invest in Compliance Software for Insurance Agency Management?

Agenzee team

13th May 2024 7 min read
Insurtech All Audiences

Insurance agencies face a series of daily operational demands, which often make time scarce. So, why not consider adopting software for insurance agency management to assist in this matter?

In addition to all the other demands from the industry, insurance agencies need to deal with a delicate subject that requires a lot of attention—staying compliant.

If you’re still stuck carrying out manual and outdated tasks and still have doubts about adopting something more technological, don’t worry! Here, we’ll highlight the main reasons why investing in software will completely transform the way you operate.

Why Compliance Should Be Your Top Priority When Acquiring New Solutions?

It may seem basic, but compliance is more complex than you might imagine.

Within insurance agencies, compliance involves internal systems, operational procedures, and methods adopted to manage compliance-related risks. There is no distinction between size, nature, or sector of activity—everyone must comply with established standards.

Regarding licenses, your agency must pay attention to state laws and requirements for their renewal. This is the crucial point where many insurance companies fall into compliance issues.

Any indication of non-compliance, missed deadlines, or incorrect information can result in the non-renewal of the policy and legal penalties. Investing in software for insurance agency management is the best strategy for any agency seeking not only compliance and sustainable growth but also peace of mind.

How Can I Identify Non-Compliance Risks?

There are many ways in which your agency may be failing to stay compliant. You should conduct a thorough analysis to identify your internal gaps. Here are some common problems that lead to non-compliance, but are often overlooked by managers:

  • Producers and agents selling insurance without a license or appointment
  • Lack of control over all license renewal requirements, such as Continuing Education (CE) hours
  • Missed license or appointment renewal deadlines
  • Misalignment between the field and the risk team
  • Lack of documentation and organization
  • Errors from manual input
  • Inefficient processes
  • Lack of proper monitoring

License management is the area where agencies easily fall into non-compliance. It involves several requirements, some of which may take weeks to complete. Also, incorrect information in deadline verification can result in the expiration of the renewal, making the process even more complex.

How Investing in Software for Insurance Agency Management Will Help the Whole Business

You know better than anyone that insurance agencies have to deal with daily responsibilities that take too much of their time. Some examples are claims management, development of new products, risk assessment, customer service, financial management, and more.

Despite these operational challenges being important for success, compliance is the one factor that dictates the continuity of your operations.

If managing just one license may already consume many hours of your team, imagine many licenses at once. Insurance agency license lookup becomes an impossible process when you have a large board of producers and agents.

Manually checking producer by producer to know the status of their licenses is too much of a time-consuming task. Not to mention the difficulty of managing all these processes amidst other daily tasks.

With this, we can observe that investing in software that aids these processes is necessary for a company seeking agility and process optimization.

What Are the Practical Benefits For My Agency?

There are more benefits for your agency than you can imagine. Check out below what you are missing if you stick with manual compliance processes.

Staying Compliant

This is the most important aspect that the entire insurance sector seeks. With software for insurance agency management, you are automating license and appointment tracking. You’ll be able to check if everything is correct with just a few clicks.

Risk Reduction or Elimination

It is time to liberate one worry and task from your risk management team. Insurance agencies no longer need to lose sleep over producers selling without a license or appointment, missed deadlines, possible fines and penalties, etc.

Operational Efficiency

With all licenses and appointments aligned and renewed, you can ensure that you are working with competent professionals.

Scalability and Cost Reduction

Ever thought of not having to input data after data into a spreadsheet, go through NIPR to monitor a license status, and do the same process for each agent?

Well, Agenzee’s innovative software does that for you. First, you are going to see a huge cost reduction if you are already spending too much time on lookups. Then, you’ll grow without increasing your costs at the same rate.

Your agency is going to have over fifty producers? No problem! You can automate the insurance agency license lookup process on a large scale.

Accountability

With the software, you can even demonstrate your modern compliance processes to partners, government authorities, investors, and other stakeholders.

What Functionalities Should I Look for in Compliance Software for Insurance Agency Management?

There are some specific features you should look for when evaluating compliance software. The most relevant ones are:

  • Tracking license and appointment statuses
  • Easy license renewal without leaving the platform
  • Initiate and complete the license renewal process directly on the platform
  • Appointment and license expiration alerts to take swift action

The cherry on top is direct synchronization with the NIPR. This integration grants you instant access to all of the necessary information about licenses and appointments.

With a platform that centralizes and organizes everything in one easy-to-navigate dashboard, you eliminate the need for multiple lookups. You can also say goodbye to looking up, editing, or updating spreadsheets.

The Consequences of Not Investing in this Software

Your agency is going to face two types of consequences—more risks of dealing legally with legal penalties and loss of competitiveness over time.

Legal Consequences

From the legal side, the consequences are severe and affect both your agency and your producers or agents. The seven (7) most common penalties you have more chances to face by neglecting compliance software are:

  • Monetary penalties. The fines vary depending on the degree of non-compliance and the duration.
  • Correction orders. Authorities impose deadlines for implementing specific measures to stay compliant.
  • Temporary license suspension. That is, until you or the person responsible solves every issue or irregularity regarding the license.
  • Inability to operate. Suspension of the agency’s operations.
  • License revocation. The producer and the agency may have their licenses revoked.
  • Other legal penalties.

Loss of Market Share

On the other hand, not investing in a compliance solution generates market-related risks. Even if your agency is growing, you have a competent and professional team, and loyal clients that always renew their customers. Without proper compliance management, you are risking losing everything.

This may happen because the current insurance market is undergoing a deep transformation. In the last few years, economic inflation and the COVID-19 crisis have accelerated the digital transformation of every single industry.

Other insurance agencies or businesses are putting money into software to increase efficiency and scalability, cut costs, save time, and more. If you don’t do the same, you are going to face consequences such as:

  • Loss of clients. Any error leads to penalties, and your clients will stop buying your products.
  • Loss of talents and partnerships. The best producers, agents, and MGAs are looking for modern agencies that automate administrative tasks. With this, they’ll be able to focus on selling and building relationships with clients.
  • Weak image and credibility. Other agencies will have more time and resources to invest in marketing.
  • Distrust from stakeholders. If you have the option to implement a solution to minimize compliance risks, why not do it? That’s how stakeholders think, and they won’t trust your agency if you don’t modernize your compliance processes.

Prepare Your Agency for the Evolving Compliance Complexity

As time goes by, the pace of change in the insurance sector is increasing.

These changes can make it difficult for insurers to keep up with the latest requirements and compliance issues.

If you provide insurance services and products, you need to be aware that regulators are increasingly vigilant about this type of transition. They are expanding their oversight to include both traditional products and emerging innovations in the insurance sector.

As a result, there are going to be more compliance challenges over time and insurance agency license lookup becomes impossible. This will make it even more difficult for you to manage licenses and appointments.

That’s why you should prepare yourself by automating your compliance process. There’s nothing better than a software solution to help you with these upcoming changes.

Get Your Software for Insurance Agency Management With Agenzee

Ready to leave manual processes behind and harness the full potential of technology? At Agenzee, we understand your challenges and exactly what you need to improve. We developed our license and appointment management software to specifically address your concerns.

We also consider evolving compliance changes. That’s why we update our features monthly to meet market demands and ensure the best experience for you as our user! 

Since this is new technology, we understand you might feel hesitant or have no idea how it works. That’s why we offer a demo to guide you through every single feature. You’ll also see how it will be easy to use for your entire team.

Enjoy all the benefits and streamline your processes with Agenzee. Ask now for your free personalized demo!

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