The History of Marketplace Regulation
Unit (1) One: The History of Marketplace Regulation.
Obtaining and retaining the Authority to conduct the business of insurance hasn’t always been as standardized as it is today.
The issue of an Unauthorized Insurance Entities was first legally identified by Virginia in 1868 when they became the first state to restrict the activities of non–resident insurance agents.
150 years later, insurance regulators are still combating unauthorized entities because, like viruses, criminals have a way of re-surfacing with new more creative schemes. Reflecting on history, gives us an opportunity to better identify “anomalies” and the symptoms which led to past issues. With experience, comes the mastery over your environment.
- A marketplace capable of identifying symptoms, gains the ability to evolve and adjust to conditions, rather than simply react to problems.
Only entities who’ve obtained proper DFS Authorization may deliver an insurance value proposition to the public. Imagine if these minimum standards weren’t in place… The experience of buying insurance would feel like trying to get through dinner at a restaurant with an untrained server on their 1st night – DISASTER.
Professional accountability is a terrific way to deter agents from cutting corners and helps to minimalize inadvertent misunderstandings. A simple misunderstanding is capable of render a policy worthless when it’s needed the most. If clients had to manage financially catastrophic consequences even with insurance in place, consumers would lose confidence in the option.
The next three (3) key legal battles we discuss are thrown into the mix because, they illustrate the processes which gave birth to our modern rules of marketplace engagement.
For those of us who choose to stay connected and utilize the professional resources available to us, violations are easily avoided, and success is inevitable. Professionals Verify the entities they choose to represent before they begin selling to the public. As trusted liaisons, insurance agents are responsible for the information they convey to the public.
Unauthorized entities often engage in unfair business practices which tear down consumer confidence. As licensees we have a professional and ethical responsibility to report marketplace relevant infractions which occur in our presence.
Remember… If you see something, say something is the mantra of self-regulation.