Advanced life insurance sales professionals must "get comfortable" with oversight by the National Association of Securities Dealers, warned the former president and CEO of John Hancock Life Insurance Company.
Equally important, said Jim Benson, currently president and CEO of Clark Benson, Southborough, Mass., the advanced life insurance professional must upgrade the technology he uses to interact with clients as "financial services convergence" continues.
But where the advanced life professional may prevail is that "face to face representation will always be important.
"Two things that cannot be programmed into a computer are the ability to cultivate personal relationships and the ability to persuade an individual to take action for their own best interests," Benson said. "Those capabilities are clearly the product of human beings, particularly well-trained human beings like ourselves."
This "distribution convergence" means that the advanced life insurance sales professional must now compete with employees of brokerages and banks, Benson explained. He spoke at the annual meeting of the Association for Advanced Life Underwriting here last month.
"I don't think the NASD understands the insurance business, and I am sure we don't necessarily understand the NASD," Benson said.
For example, he explained, when an advanced life insurance sales professional talks of variable universal life, "we like to think of an insurance policy with some separate accounts."
But when NASD officials hear of variable universal life, "they think of it as a security that has insurance features," he said.
Benson explained that while the insurance sales professional "has a different point of view, the bad news is that we have to follow the NASD rules."
"I am not sure we are going to be able to convince them to change all the rules, to take into account the complex nature of insurance transactions," Benson said. "But we have to live within the rules."
