Licensing milestone reached in US
The US Travel Insurance Association (UStiA) has achieved a milestone in the quest for adoption of a uniform licensing standard for travel agents and other sellers of travel insurance in the US. Mandy Aitchison reports on the new guidelines Acting on recommendations from the UStiA, and with the assistance of the American Society of Travel Agents (ASTA), on 21 October the National Association of Insurance Commissioners (NAIC) adopted language for a new Uniform Licensing Standard and Implementation Guideline that would significantly streamline the licensing process for selling travel insurance, while at the same time improving the protection giving to customers. Jim Grace, president of the UStiA, said: “By amending the current licensing standards, we have made major progress toward reducing licensing burdens for retailers offering travel insurance. At the same time, the new standard will, once implemented in all states, offer greater transparency and consistent consumer protection.” Previously, each travel agency, travel agent and others selling travel insurance cover had to be licensed in the states in which they conduct their business. The new NAIC guidelines lay the groundwork for states to adopt one common licensing approach, replacing the old fragmented system. In the states that adopt the amendment, travel retailers that sell insurance will be allowed to offer and disseminate their products without a licence, as long as specified consumer protection requirements are met. Under the new NAIC Standards and Guidelines, allowable non-licensed activities would include offering general information such as descriptions of coverage and pricing, as well as processing applications and collecting premiums, so long as the insurance provider (managing general agent and nationally licensed producer) whose product is being sold holds a business entity licence. The UStiA has described the new amendment as a win-win situation for both travel agents and consumers, with Grace saying: “Once states have adopted the NAIC standards, travel agents offering and disseminating travel insurance can do so under the provider’s licence and will not need to be licensed themselves. This move will help provide travel agencies with a value-added source of revenue.” For consumers, the new standard provides greater protection as it requires the insurance provider to meet a number of criteria, including clearly identifying itself in all sales and fulfilment materials, registering the travel retailer by state, conducting background checks, training non-insurance travel retailers, and more. “The recommended change has major implications for consumers,” said Grace. “By providing one set of licensing standards across all 50 states, the travelling public can be assured that there will be more consistent control over those who sell travel insurance.” Finally, Grace warned that the adoption of the new guidelines is still in its infancy, with much more work to come: “The UStiA has worked hard on the issue of uniform licensing. We have come a long way, and couldn’t have accomplished this without the help of our members and the support of ASTA. However, while NAIC’s adoption of the new language represents a major accomplishment, this is not the end of the road. We still have a lot of work ahead to ensure that each state’s insurance commission implements these guidelines.”
The US Travel Insurance Association (UStiA) has achieved a milestone in the quest for adoption of a uniform licensing standard for travel agents and other sellers of travel insurance in the US. Mandy Aitchison reports on the new guidelines
Acting on recommendations from the UStiA, and with the assistance of the American Society of Travel Agents (ASTA), on 21 October the National Association of Insurance Commissioners (NAIC) adopted language for a new Uniform Licensing Standard and Implementation Guideline that would significantly streamline the licensing process for selling travel insurance, while at the same time improving the protection giving to customers.
Jim Grace, president of the UStiA, said: “By amending the current licensing standards, we have made major progress toward reducing licensing burdens for retailers offering travel insurance. At the same time, the new standard will, once implemented in all states, offer greater transparency and consistent consumer protection.”
Previously, each travel agency, travel agent and others selling travel insurance cover had to be licensed in the states in which they conduct their business. The new NAIC guidelines lay the groundwork for states to adopt one common licensing approach, replacing the old fragmented system. In the states that adopt the amendment, travel retailers that sell insurance will be allowed to offer and disseminate their products without a licence, as long as specified consumer protection requirements are met. Under the new NAIC Standards and Guidelines, allowable non-licensed activities would include offering general information such as descriptions of coverage and pricing, as well as processing applications and collecting premiums, so long as the insurance provider (managing general agent and nationally licensed producer) whose product is being sold holds a business entity licence.
The UStiA has described the new amendment as a win-win situation for both travel agents and consumers, with Grace saying: “Once states have adopted the NAIC standards, travel agents offering and disseminating travel insurance can do so under the provider’s licence and will not need to be licensed themselves. This move will help provide travel agencies with a value-added source of revenue.”
For consumers, the new standard provides greater protection as it requires the insurance provider to meet a number of criteria, including clearly identifying itself in all sales and fulfilment materials, registering the travel retailer by state, conducting background checks, training non-insurance travel retailers, and more. “The recommended change has major implications for consumers,” said Grace. “By providing one set of licensing standards across all 50 states, the travelling public can be assured that there will be more consistent control over those who sell travel insurance.”
Finally, Grace warned that the adoption of the new guidelines is still in its infancy, with much more work to come: “The UStiA has worked hard on the issue of uniform licensing. We have come a long way, and couldn’t have accomplished this without the help of our members and the support of ASTA. However, while NAIC’s adoption of the new language represents a major accomplishment, this is not the end of the road. We still have a lot of work ahead to ensure that each state’s insurance commission implements these guidelines.”