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DTCC’s Insurance & Retirement Services (I&RS) is taking a leadership role in bringing a diverse community of life insurance stakeholders together to discuss opportunities for improving industry automation and standardization in key processes.

The move into life insurance marks a logical expansion for DTCC’s insurance business. “During the 15 years I&RS has been operating, it has traditionally focused on annuities,” said Lana Macumber, DTCC Director of Strategy for I&RS. “Because of the many synergies between life insurance and annuities, it’s a natural transition for I&RS to become a leading solution provider in the life insurance industry, as well.”

Image - Bryan AdamAdam Bryan, DTCC Managing Director and General Manager, Insurance & Retirement Services

At the same table

To explore opportunities to streamline the life industry, DTCC hosted a two-day Life Forum in Atlanta in December 2012.

The forum broke new ground, according to Adam Bryan, DTCC Managing Director and General Manager of I&RS. He explained that the life insurance industry consists of a broad range of participants, including brokerage general agents, large broker/dealers, independent broker/dealers, insurance marketing associations, clearing firms, insurance carriers and industry organizations. “Before our Life Forum, all these groups had never been brought together in one room to discuss issues pertinent to their industry,” Bryan said. “We now have a platform for greater collaboration in this significant industry segment.”

Overview of the event

The forum drew 40 individuals representing major insurance carriers, distribution firms and industry associations.

Executives from key industry organizations spoke, contributing expert insights about the current state of life insurance and forces driving change within the industry. Represented were the Association for Cooperative Operations, Research and Development (ACORD), the Life Insurance Market Research Association/Life Office Management Association (LIMRA/LOMA) and the National Association of Independent Life Brokerage Agencies (NAILBA).

  • Jeff Hasty, Senior Vice President of LOMA, shared compelling statistics that reflect how changing demographics point to the need for innovation in the insurance industry to better reach the many people nearing retirement age daily, for whom research shows retirement financing is a top concern.
  • Chris Chartrand, Principal, Chartrand Advantage LLC, who represented ACORD, spoke about life products becoming increasingly complex and costly, and the need for new systems to simplify and speed processing.
  • Christopher Soniat, Executive Director of BRAMCO Financial Resources, representing NAILBA, emphasized a need for increasing the number of knowledgeable producers to drive business to the millions of underinsured in the U.S., and also for companies to manage regulatory demands for higher levels of reserves.

Breakout sessions allowed forum attendees to voice industry issues and concerns, among which cost was a consistent theme. With resources stretched and budgets low, participants emphasized the need to leverage existing products and services to streamline processing, particularly those offered by DTCC. They also indicated a desire for simple, accessible solutions offered to distributors and carriers.

Three priorities

Following robust brainstorming, forum attendees achieved consensus on three major concerns:

  • To address challenges related to processing and paying commissions, firms desire the standardization of terminology, more automation in communicating commission schedules, support for complex payment hierarchies and shortening of commission payable cycles.
  • To enable efficient producer management, there is a need to simplify contract agreements. Attendees called for a centralized source for agent data and a “gold standard” location for producer information, potentially I&RS’ new Producer Management Portal, which is a centralized service that assists firms in sharing, tracking and verifying producer training completions as required by state regulators.
  • To better manage the processing of new business, desired solutions involve standardizing both forms and the pending case status across the industry, as well as creating an electronic application process to achieve straight-through processing.

Moving forward

DTCC followed up on the forum with a survey of all attendees and hosted calls to “interested parties” who did not attend the forum in order to gain further insights into the landscape for life insurance. “We have gained a wealth of valuable feedback post-forum,” Macumber said of the growing interested party list. “The industry sees solid development opportunities for I&RS within the life marketplace.”

To ensure continued progress in building solutions that address the industry’s priorities, DTCC is now formulating next steps, according to Bryan. “We are consolidating the research we have conducted and the feedback we have received to develop best practices for processing life insurance,” he said. “We will propose specific solutions for the three prioritized action items that directly tie to survey results: commission data reporting, commission schedule/rate profile and new business application management. Our goal is to leverage DTCC’s core competencies to bring new efficiencies and risk reduction to address the life insurance industry’s complex processing challenges.”

[For more information on I&RS’ life initiatives, contact your relationship manager or email Lana Macumber at]