You did your job. You talked to your client about fixed annuities and their benefits and how they can help with retirement planning goals. You took their application, and made sure it was fully completed. You checked that you had all the required forms. Your client gave you a check and you submitted the application to the insurance carrier. You did everything you were supposed to do.

Done, right? Not so fast. You may not be done. You may be in for a real surprise when the application is not accepted and returned to you. Why?  Read on…

Since the National Association of Insurance Commissioners finalized its Suitability in Annuities Regulation in March of 2010, multiple states have adopted the regulation and all states are required to do so before the end of 2013. The regulation requires all annuity producers to receive mandatory suitability and product training. 

At first glance, it doesn’t sound so difficult really. Take a course and you’re done, right?  Unfortunately, that is not the case.

When the state adopted the regulation, the date your producer license went into effect, whether state-specific content or refresher training is required and if there are requirements for resident and non-resident brokers/producers all vary by state and all impact when you must have this mandatory training completed. The suitability training must be taken through a state-authorized continuing education provider and must be at least four hours in length. In addition, each insurance carrier must also develop standards for product training and must validate that those brokers and producers doing business with them are in compliance with both the one-time course and the product training. 

Although the regulation provided a guideline for the mandatory training, each state retains the right to decide the specific details of the training requirements. In addition, each carrier must develop its standards for product training. This means that there will be differences from state to state and insurance carrier to insurance carrier (for example, some insurance carriers require separate product-specific training based on the different types of annuities they offer). If you are selling annuities in more than one state and with more than one carrier you have a lot to make sure of before you sign an application. 

Insurance carriers are helping, though. Many have their guidelines, rules and what is required for their product training by state outlined on their websites. Several insurance carriers provide for the required product training to be completed online. One I know of even says it takes as little as 10 minutes to complete. Other third-party online resources can also help you to become more educated on the regulation and requirements.

Educating yourself on the requirements for the states you do business in and for the carriers you represent is a must. You cannot get around it. The training is mandatory and it is not negotiable. Don’t get caught, like many already have, with an application back in your office, rejected. Many states and insurance carriers require the completion of the training before any application for an annuity can be taken. That means if you don’t fulfill the mandatory requirement in advance the application will be returned. Case closed. We may not like it, but,it won’t change anything to get mad. It can however, make a case to get educated. If you are going to sell fixed annuities it’s required.