DTCC Launches Producer Training Enhancements to LNA Services
In response to new state insurance regulation, DTCC is releasing significant enhancements to the Insurance & Retirement Services LNA service. These enhancements enable carriers to track and confirm if producers have been trained and certified to sell their specific annuity products.
In early 2010, the National Association of Insurance Commissioners (NAIC) released suggested state-level requirements titled "Suitability in Annuity Transactions Model Regulation." As a result, for all participating states, insurance producers selling annuity products must now participate in a fourhour suitability course on the fundamentals of annuities, as well as complete productspecific training from carriers for which they solicit annuity products. This new regulation puts the onus on carriers who must now provide the appropriate product training and validate that producers have fulfilled both state suitability and product training requirements.
"When the NAIC guidelines were released, many of our clients came to us requesting a centralized, automated solution to communicate the completion of the requirements between all applicable trading parties," comments Lana Macumber, Director of Strategy and Business Development for DTCC I&RS. "We realized the immediacy and breadth of the compliance challenge our clients faced and we began researching a solution right away."
Working closely with the I&RS Senior Advisory Board, DTCC recognized the potential for enhancements to LNA which automates and standardizes the two-way flow of information needed to manage producer authorization information between carriers and distributors. DTCC developed a plan to create a new training record for the existing LNA service format to accommodate the training data so that carriers could receive and share information regarding producers who had been trained and certified. DTCC also began working with seven industry education vendors that provide the online/classroom training curriculums in order to create a channel through which the data could be received and communicated amongst carriers and distributors. These education vendors are Kaplan, PinPoint, QuestCE, RegEd, Sircon, SuccessCE, and WebCE.
The first set of enhancements, released in April, allows for the receipt of data from vendors and transmission to carriers. In September 2011, DTCC will release a set of developments allowing for two-way communication between carriers and distributors as well as new reporting capabilities from the I&RS Access platform, a non-integrated user interface that will allow distributors to download a readable report of training completions from vendors and carriers
In 2012, I&RS aims to provide a real-time authorization messaging portal for pointof- sale and transaction processing. By leveraging XML messaging for producer "can-sell" authorizations, DTCC plans to navigate messages from an order entry or distribution requestor to a centralized training portal that will provide a calculated training authorization response.
"The LNA enhancements are a true reflection of our value proposition to the industry," comments Macumber. "We are hopeful that our solution delivers the centralization and standardization the market needs to mitigate risk and manage these new guidelines. We’ve created a highly efficient process that leverages existing technology, and can put the collective data into the hands of the people who need it."