Regulatory Modernization Makes Sense for Consumers
The COVID-19 pandemic has changed everyday language. We now commonly use words and phrases like “work from home,” “socially distant,” and “contactless.”
Another word that the life insurance industry and regulatory community can take to heart is “instructive.” During the pandemic we have learned, and we continue to learn. Experience is teaching life insurers that we can serve our customers better through expanded use of electronic signatures, electronic delivery, and online notarization of documents and video-proctored licensing examinations.
The regulatory community has supported consumers by granting temporary accommodations or waivers to regulatory requirements, allowing these types of enhancements. Today, state and federal regulators are examining policies and procedures to identify what changes might be made permanent. The life insurance industry strongly supports these efforts.
Regulator efforts to help consumers are nothing new.
In ’71, the state insurance regulatory community gathered and noted that “[t]he true object and aim of governmental supervision should be to afford the fullest possible protection to the public [. . .]. To see to it that the companies possess and maintain the means and ability to fully respond to all their contracts and obligations [. . .].”
The year was 1871. Ulysses S. Grant was the president and it was the year of the Great Chicago Fire. State insurance regulators gathered for the first time to establish what became the National Association of Insurance Commissioners. Although times have changed – dramatically since 1871, and dramatically in 2020 due to COVID-19 – the core purpose of the regulatory community has remained the same.
In 2020, the life insurance industry has extended contact hours, enhanced online capabilities and given premium payment accommodations to customers who have been impacted by COVID-19. We’ve witnessed the rise of video connectivity and the emptying of offices.
This year has been instructive because we have learned – and proven – that these temporary accommodations work. Consumers are protected and the industry has been able to “fully respond to all their contracts and obligations,” just as it did nearly 150 years ago.