Bankers are prohibited from soliciting, selling or even discussing annuities without a life insurance producer's license
An increasing number of bank representatives are selling insurance products. The banking and insurance industries are indirectly connected, and transitioning customers from one product line to the next is often logical.However, conducting banking business and insurance transactions requires different licenses.
State Regulation
The insurance industry is regulated at the state level, and anyone wishing to work in the life insurance arena must obtain the proper producer's license. Regardless of any prior training or certification in the financial industry, bankers are prohibited from soliciting, selling or even discussing annuities without a life insurance producer's license.
No federal license exists that allows bankers or other individuals to avoid or circumvent the need for a state insurance license.
Annuity Classification
Although fixed annuities are retirement savings vehicles, they are maintained by life insurance companies and fall under the regulation of your state's insurance department.
Bankers who solicit annuities must be properly licensed with their resident state and any other state in which they sell annuities. There are severe penalties for anyone who engages in the marketing or writing of annuity contracts without proper licensure.
Life Insurance Components
Because annuity contracts contain life insurance components, states require the people soliciting and selling these products to be versed in all aspects of life insurance. Annuity providers typically offer several life insurance features that owners can choose to include in their contracts, and many of these features result in additional fees deducted from the account.
Bankers must obtain a life insurance producer's license from their state and must demonstrate proficiency and comprehension of these features and their costs.
Continuing Education
Life insurance producers must complete a specified number of continuing education courses to maintain an active license. Each state has its own continuing education regulations and the average requirement equates to 12 credits per year.
Producers must attend courses and workshops or complete online equivalents in subject areas including fraud detection and prevention, product suitability, advanced planning concepts and anti-money laundering. Although bankers may be required to complete similar educational courses, it is unlikely that non-insurance-industry education will waive these requirements.
Article originally published on Chron.com (09/06/2012)
No comments :
Post a Comment