Insurance industry firms continue to make progress on the development of an industry-wide advisor screening, contracting and compliance tool, and the result will be much more efficient processes not only for firms, but also for advisors, according to industry players.
At an event hosted in Toronto on Thursday, speakers highlighted recent advancements in an initiative to build a centralized industry-wide database of insurance advisors. The project is being spearheaded by APEXA Corp., a subsidiary of Toronto-based insurance sector consulting and outsourcing firm LOGiQ3 Corp., in collaboration with a variety of major life insurance companies, managing general agencies (MGAs) and industry vendors.
The goal of the initiative is to aggregate all of the advisor information that insurers and MGAs need to collect in order to meet their screening and compliance monitoring responsibilities, such as licensing and errors and omissions (E&O) insurance details.
“We’re doing something that’s never been done,” said Chris Murumets, interim CEO of APEXA. “We’re trying to build more transparency, build more efficiency, and build a better industry around that.”
Murumets said the initiative has gained widespread industry support, which has helped to push the project forward in the past year. Specifically, APEXA has been working closely with Toronto-based BlueSun Inc. to build the technological system behind the database. This service is currently in prototyping phase and aims to launch nationwide during the second half of 2015.
“This is no longer an idea,” Murumets said, “it’s no longer something that could happen if the stars align – it’s happening.”
Once it’s up and running, APEXA will make the processes of advisor screening, contracting and compliance monitoring easier for all parties involved, according to Dylan Friedmann, vice president of client and partner experience at APEXA.
“It’s a win for the carriers, it’s a win for the MGAs, and it’s an absolute win for the advisors,” said Friedmann.
For instance, she said the platform will make it easier for advisors to meet their compliance requirements by helping them track their continuing education (CE) credits, and by providing them with a single centralized hub for all of their current licensing, E&O and contact information, rather than requiring them to notify multiple parties each time there’s a change.
“We want to make it a great experience,” Friedmann said. “We want to make it simple, we want to make it straightforward.”
Industry executives at Thursday’s event said they’re encouraged by the progress APEXA has made, particularly given the rapidly growing compliance requirements that the industry is facing.
“I think this solution allows us to do a better job of monitoring the advisors that we’re doing business with,” said Terri Botosan, president of Hub Financial Inc. “We needed a better way to have a view of our advisors…and a better way to feel comfortable that we were looking at the right things and having red flags raised when it’s appropriate, and not putting advisors through undue process.”
Greg Pollock, president and CEO of the Financial Advisors Association of Canada (a.k.a. Advocis), said he’s also encouraged to see the industry taking the initiative to build proactive solutions as it deals with growing regulatory scrutiny.
“Compliance costs are going up … I hear this from every company, that this is now their largest department,” Pollock said. “Industry-led solutions [are] definitely the way to go.”