WINDSOR, Conn., April 10, 2008 — Over the past two years, almost one third of independent producers surveyed have dropped their Series 6 license, according to a recent study by LIMRA International.
“The report underscores the problems associated with today's complex compliance requirements,” said Robert Kerzner, president and CEO of LIMRA, LOMA and LL Global. “Producers are overwhelmed by the compliance function yet all of the complexity is not giving clients a better understanding of the products they are buying and we are continuing to lose qualified producers.”
The report, Practice Management Support: Giving Producers What They Need, is the result of its most recent LIMRA Producers Panel survey, which focused on their use of technology, the impact of compliance, professional development opportunities, and the type of field support provided by their carriers and Broker-Dealers (B-D).
While more than 80 percent of the producers hold at least one FINRA license, increasingly, they are dropping their Series 6 license because of the burdens of compliance regulations. Many producers said the volume of investment business did not justify the additional requirements or expense.
In the survey, half the producers complained that adhering to the growing compliance requirements takes too much time and generally confuses their clients. In some cases, managers producers of larger agencies said that they have added dedicated compliance personnel to their management staff. Others said (50 percent) that their agency managers were responsible for the compliance—taking away their ability to perform their other duties. Twelve percent of producers’ agencies outsource compliance functions.
In terms of how producers stay informed, 46 percent of affiliated agents said they receive information from their agency’s compliance officer but that number drops to nine percent when talking to independent producers. Half of all producers surveyed get their compliance information from B-Ds. Of those, 60 percent rate the compliance information provided as excellent or very good.
Another area where producers feel they need more support is professional development. More than a third want to learn how to develop and implement formal sales and marketing programs. They were also interested in learning how to use technology more effectively and time management. All the responses indicated that improving efficiency was the top of mind issue of most of the producers.
Overall, producers are challenged to find ways to increase productivity to offset the rising costs of doing business. They are looking to carriers and B-Ds to provide more support to help them grow and remain profitable.
About LIMRA International
LIMRA International is a worldwide research, consulting and professional development organization that helps more than 850 insurance and financial services companies in 73 countries increase their marketing and distribution effectiveness. Visit LIMRA International at www.limra.com.